Huawei unveils US$61.5mn distribution center

Chinese manufacturer Huawei has unveiled a 123mn-real (US$61.5mn) distribution center in the Brazilian city of Sorocaba, in São Paulo state, to support its growth strategy in Brazil and in some countries in South America. The announcement was made in a press conference in São Paulo by Huawei Brazil CEO Li Ke, who is also president for the South America unit, which includes Brazil, Argentina, Chile, Peru, Bolivia, Uruguay and Paraguay. The facility is said to be the company's largest of its kind in Latin America, in which Huawei aims to produce and store initially terminals and radiobase stations made in partnership with electronics manufacturer Flextronics. Huawei chose Sorocaba mainly because it is only 3.5km from Brazil's main port, Santos, which would help to improve the company's delivery and logistics processes. According to Ke, the Sorocaba center brings together seven other small regional centers, which were all shut down, and is expected to have a maximum monthly delivery capacity of 10,000 products. The unit will employ 400 professionals directly and 200 more indirectly and will also serve operations in Peru and Chile. The company is maintaining another 11 centers countrywide, "to be the last-mile of the distribution chain" and its six national subsidiaries, located in São Paulo, Rio de Janeiro, Curitiba, Manaus, Recife and Brasília. For 2012, the company aims to bill US$2bn in Brazil, which currently accounts to 60-70% of Huawei's revenues in South America, and reach US$5bn by 2016. Of that amount, some US$1.5bn is expected to come from the corporate market alone, as according to the company it has been focusing heavily on R&D to expand its portfolio for the segment, especially regarding cloud solutions, and for another six market verticals as well. The executive highlighted that Huawei has invested US$363mn in Brazil since 2004 and last year, purchased US$310mn in components and materials from suppliers.