Pictured here is the Grand Indonesia Mall in Jakarta on Friday, January 5, 2024.
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BEIJING – Huawei Spinoff Honor announced on Tuesday that it plans to launch smartphone sales in Indonesia by the end of March, becoming the latest Chinese company to enter a market that has banned Apple's iPhone 16 due to local production requirements.
Indonesia requires that for smartphones sold in the country, 40% of their components must be locally sourced. This rule has prevented Apple from selling its latest phones in the market, where it is said to be negotiating a billion dollar investment.
Honor has an office in Indonesia and works with one local manufacturing partner, Justin Li, the Chinese company's president of South Pacific operations, told reporters last week. He said the foldable phone will be among the first batch of products sold locally from Honor – 10 items in the mid-range to high-end segment.
The company aims to introduce about 30 products from phones to tablets in Indonesia by the end of the year. The Southeast Asian country is home to the fourth-most populous country in the world, just behind the United States.
“Although 80% of the market is dominated by sub-$200 devices, as Southeast Asia’s largest and fastest-growing economy, Indonesia offers huge potential for growth,” Qiu Luo Xuan, an analyst at Canalys, said in an email. In the long term.
“Indonesia is emerging as a key market in Southeast Asia, driven by rapid economic growth and an expanding middle class,” Chiu said, noting that the country accounts for 35% of smartphone shipments in the region and could serve as a strategic regional hub.
As of November, China-based Oppo, Xiaomi and Transmission held the top three spots in Indonesia in terms of smartphone shipments, according to Canalys. Shenzhen-based Oppo in November held the global launch of its flagship Find X8 phone in Indonesia, where the company also has a factory.
Canalys data showed that Samsung ranked fourth in Indonesia with a 16% share, tied with Vivo, another Chinese brand.
Excluding China and Japan, less than 8% of Apple's sales come from the Asia-Pacific region.
Lee claimed that the decision to enter Indonesia was independent of Apple's presence in the country, and he was confident in Honor's ability to compete. He said Honor had monitored the Indonesian market for years, before doubling its expansion efforts in the latter half of the year.
While he declined to share the current breakdown of Indonesian and Chinese employees, Lee said Honor is still hiring in the country and aims to have mostly local employees in the future.
Honor plans to open at least 10 of its own stores in Indonesia this year, in addition to selling through a local retailer, Lee said.
Outside of China, Honor mainly sells in Europe and parts of Southeast Asia. Its phones are not sold directly in the United States. The company claimed that in December, more than half of its sales came from outside China for the first time.
Honor, which plans to go public, was separated from Chinese telecom giant Huawei in November 2020 after the parent company came under US sanctions. Huawei said it does not own any shares in Honor or participate in business decisions.
