An iPad 2 production line is being setup in Brazil

Rumors have been floating around for some time about the possibility of some Apple products being assembled in Brazil.  These rumors got a lot more substance today as one of the two largest newspapers in the country published an article stating that components where already being shipped to the location of a Foxconn factory in the Brazilian state of São Paulo.  This facility currently produces computers and other types of electronic equipment for HP and Sony.

If this rumor turns out to really be true it should drive down the price of the iPad in Brazil by a large  factor.  Such a reduction would almost immediately result in increased sales as the current high price of the device acts as deterrent to lower-income users making a choice between getting a netbook and an iPad. Currently, a first generation 16GB WiFi iPad is being sold in Brazil for around $820.  The fiscal incentives offered to electronics manufacturers that handle final assembly in the country and the reclassification of the iPad as PC by the Brazilian federal government could result in as much as a 40% reduction in the price of the iPad for the Brazilian consumer.

With Apple selling iPads just about as fast as they can manufacture them, it would make a lot of sense for Foxcomm, that does the actual manufacturing, to expand production to more of their factories.  Brazilian billionaire Eike Batista, who currently figures as the 8th richest person on the planet according to Forbes, is known to have been actively working to persuade Foxcomm to seek Apple’s agreement to start production of Apple products in Brazil.


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