Foxconn set to discontinue Brazil manufacturing operations

The firm appears to be giving up on the country following promises of $12bn investment.

Foxconn is set to cease its manufacturing activities in Brazil, according to sources close to the Taiwanese company.

The company's staff have been working on shutting down the facility located in Jundiaí, a city in the metropolitan region of São Paulo, and assisting on the deactivation and sale of machinery, according to Brazilian business magazine IstoÉDinheiro.

Foxconn had a second facility in the same business park, which is already empty. The idea is to only keep a limited local set-up intended for parts replacement and maintenance, according to the article.

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The company did not reply to ZDNet's requests for comment but local publications have cited a statement from the firm denying the downsizing of its local business. However, market sources have confirmed that the company is indeed preparing to close down its Brazil manufacturing operations.

The news Foxconn is stopping its manufacturing activities in Brazil is a far cry from all the noise the firm caused a few years ago: back in 2011, the company had pledged to invest $12bn in the country and create 100,000 local jobs within six years.

However, the promises soon proved hard to keep: the company wanted the Brazilian government to come up with 30 percent of the cash, as well as a private investor - both failed to materialize.

As well as the economic instability that the Brazilian economy, it is also rumored that other factors influencing the decision include the productivity of the local workforce - which at its peak reached about 2,500 workers - which Foxconn considers to be low when compared to its main manufacturing operations.

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