Last updated: 12 June 2017
Manufacturing electronics in Brazil has proven to be a profitable option for many international companies.
Manufacturing electronics in Brazil has proven to be a profitable option for many international companies. In this article we will list some of the most relevant electronics manufacturing outsourcing companies in Brazil.
Market Conditions and Advantages of Local Manufacturing
Brazilian taxation policies for the import of electronics can result in these products reaching the national market at price points that are highly uncompetitive. This has been one of the main reasons for leading global electronics manufacturers to set up manufacturing operations in the country, as the overall taxation for locally produced goods is much lower than those applied to imported ones.
Other reasons for companies to set up local manufacturing plants in Brazil include taxation reductions and other financial benefits offered to those that intend to set up new installations in specific regions of the country. One of the main destinations for foreign manufacturers is the Manaus Free Trade Zone, which holds over 230 electronics industries and where these companies are offered exemptions of taxes IPI, PIS and Cofins and also reductions in income tax amongst others.
Along with serving the national market, many foreign electronics manufacturers have directed their production from Brazilian facilities to other major countries in Latin America. Brazil holds a strategic position in the continent since it provides easy access by road to countries such as Argentina, Venezuela and Colombia, which are all part of thefree trade agreement of Mercosul. Exports of electronics to these markets can add up to the potential profits of setting up manufacturing operations in Brazilian cities.
A common strategy for international electronics brands that expand to the Brazilian market has been the outsourcing of manufacturing and assembly services to contracted partners that operate their own facilities in the country. Some of the most evident benefits of outsourcing electronics manufacturing in Brazil include reduced bureaucracy and fewer risks of managing a proprietary facility, along with the usual reductions in taxation when compared to importing manufactured products to the country.
During recent years, global giants such as Microsoft and Motorola, who used to operate proprietary manufacturing facilities in the country, have signed outsourcing agreements with Electronics Manufacturing Services providers in order to streamline their operations. It is expected that other major electronics brands operating in Brazil will follow the same path in the future, as outsourcing turns into a more appealing option than setting up manufacturing centers.
EMS providers in Brazil
Some of the largest EMS companies in the world have set up sizable manufacturing and assembly facilities in Brazil, while national companies also compete in the market for outsourcing products and components manufacturing. Some of the largest EMS providers in Brazil include:
The second largest electronics contract manufacturer in the world, the North-American company Flextronics currently operates four facilities in Brazil, two of them in the city of Manaus, one in Jaguariúna and one in the city of Sorocaba. Some of their operations in Brazil include the manufacturing of smartphones, portable computers, motherboards, video game consoles and network components, along with other types of electronics such as flight monitoring equipment, industrial automation components and GPS systems. Some of the major electronics brands that have signed up with Flextronics in Brazil include Microsoft, Motorola and Sony.
Taiwanese company Foxconn, the largest contract manufacturer of electronics in the world, operates facilities in the cities of Manaus, Jundiaí and Indaiatuba, and is expected to finish the construction of a new manufacturing plant in the city of Itu during the next few years. Among its product manufacturing and assembly portfolio are smartphones, tablets, portable and desktop computers, cameras, modems and a wide range of boards for electronic equipment. Some of the major electronics brands that have signed up with Foxconn in Brazil include Apple and Asus.
Brazilian company Digitron operates a manufacturing plant in the city of Manaus, where products such as portable computers, tablets and various types of computer components, such as boards and hard drives are assembled. Major electronics brands that have contracted Digitron include Western Digital and Intel.
Brazilian company Unicoba, which operates manufacturing centers in the cities of Manaus, Ilhéus and Extrema, offers EMS that include optional support for the import of materials, logistics and distribution. Some international brands that have contracted Unicoba’s services in Brazil include Alpine and Polaroid. The company also manufactures products such as batteries, LED lightning systems, TV signal receivers and automotive audio and video systems.
Circuit Board Assembly
Aside from offering EMS, a number of Brazilian electronics manufacturers have specialized in the assembly of circuit boards for third parties. Some of the circuit board contract manufacturers in Brazil include:
The Brazilian company Ateei Group offers contract manufacturing services for the production and assembly of circuit boards, with compatibility with SMT and THT technologies. The company operates a manufacturing plant in the city of Ouro Verde, in the state of Paraná, and also produces telemetry systems and monitoring equipment.
The Brazilian electronics manufacturer Parks, who are also specialized in the production of telecommunication equipment, operates a manufacturing plant in the city of Cachoeirinha, in the state of Rio Grande do Sul, and offers outsourcing contracts for the assembly of circuit boards with compatibility with SMD and PTH technologies.
The Brazilian company Hi-Mix operates a manufacturing center in the city of Pato Branco, in the state of Paraná, and offers manufacturing services for various types of circuit boards compatible with PTH and SMD technologies.
The Brazilian company Citta Eletronica, who operate a manufacturing center in the city of São Paulo, offers outsourcing contracts for the assembly of circuit boards compatible with SMT and PTH technologies. The company also commercializes electronics components and offers hardware and software project management.