Captured in this image is the bustling Grand Indonesia shopping mall located in Jakarta, snapped on January 5, 2024.
In an exciting development, Honor, the offshoot of the Chinese tech giant Huawei, announced on Tuesday its plan to introduce its smartphone range to Indonesia by March’s end. This makes it the latest in a line of Chinese brands stepping into a market that currently bans the sale of Apple’s iPhone 16 due to local production laws.
To sell smartphones in Indonesia, companies must ensure that 40% of the components are sourced domestically. This regulation has posed challenges for Apple, preventing them from launching their latest phone in the market despite reports that they’re negotiating a hefty $1 billion investment.
Honor, which has already established an office in Indonesia, is partnering with a domestic manufacturer, according to Justin Li, who oversees the South Pacific operations. During a recent conversation with reporters, he revealed that one of Honor’s debut offerings will be a folding phone, among a selection of ten mid-to-high-range products.
By the year’s conclusion, Honor aims to have around 30 different items available in Indonesia, spanning phones and tablets. Indonesia, now the world’s fourth most populous country right behind the United States, stands as a vital market.
According to Chiew Le Xuan, an analyst from Canalys, despite the fact that 80% of the market is dominated by products priced under $200, Indonesia’s position as the largest and most rapidly expanding economy in Southeast Asia suggests a promising landscape for future growth.
Chiew added that Indonesia is quickly becoming a prime site for business in Southeast Asia, driven by robust economic growth and a burgeoning middle class. The country represents 35% of smartphone shipments in the region and holds potential as a strategic hub.
As of November, Chinese brands Oppo, Xiaomi, and Transsion led the Indonesian market in smartphone shipments, Canalys reported. Oppo, headquartered in Shenzhen, launched its high-end Find X8 phone in Indonesia last November, where the company also operates a manufacturing facility.
Meanwhile, Samsung stood in fourth place, its market share tied with Vivo, another Chinese competitor, both holding a 16% slice according to Canalys.
Broadening the focus beyond China and Japan, just shy of 8% of Apple’s sales originate from the Asia-Pacific region.
Li emphasized that Honor’s decision to enter the Indonesian market was independent of Apple’s presence, expressing confidence in Honor’s competitiveness. After years of observing the market, Honor has intensified its expansion efforts over the past six months.
While Li did not specify the current mix of Indonesian vs. Chinese staff, he noted that Honor is actively hiring locally, with the goal of building a primarily local team.
This year, Honor plans to establish at least ten dedicated stores in Indonesia, alongside sales through a local retailer.
Outside China, Honor mainly has a presence in Europe and segments of Southeast Asia, but its devices are not directly sold in the U.S. Impressively, in December, more than half of Honor’s sales took place outside China for the first time.
Having begun as a Huawei spinoff, Honor was established as a separate entity in November 2020 following U.S. sanctions against Huawei. The telecom giant affirms it retains no stake in Honor nor involvement in its business decisions.
