BEIJING — Huawei spinoff Honor has announced its plans to commence smartphone sales in Indonesia by the end of March. This move makes Honor the latest Chinese company to enter a market where Apple’s iPhone 16 has been banned due to domestic production requirements.
Indonesia mandates that smartphones sold in the country must have 40% of their components domestically sourced. This regulation has prevented Apple from introducing its latest phone in the market, where it is reportedly in talks for a $1 billion investment.
Honor, with an office in Indonesia, is collaborating with a local manufacturing partner, as stated by Justin Li, the Chinese company’s president of South Pacific operations. Li mentioned that a folding phone will be among the first products to be sold locally by Honor, with a lineup of 10 items in the medium to high-end segment.
The company aims to offer approximately 30 products ranging from phones to tablets in Indonesia by the end of the year. Indonesia, the world’s fourth-largest country by population, is seen as a market with significant potential for long-term growth.
“Although the market is largely dominated by devices priced under $200, Indonesia, as Southeast Asia’s largest and fastest-growing economy, offers immense potential,” said Canalys analyst Chiew Le Xuan in an email.
Chiew highlighted Indonesia’s emergence as a key market in Southeast Asia, driven by rapid economic growth and an expanding middle class. The country accounts for 35% of smartphone shipments in the region and can serve as a strategic regional hub.
According to Canalys data from November, Oppo, Xiaomi, and Transsion, all China-based companies, held the top three spots in Indonesia by smartphone shipments. Oppo, based in Shenzhen, launched its flagship Find X8 phone globally in Indonesia in November, where the company also operates a factory.
Samsung ranked fourth in Indonesia with a 16% share, tied with Vivo, another Chinese brand, according to Canalys.
Excluding China and Japan, Apple generates just under 8% of its sales from the Asia-Pacific region.
Li stated that Honor’s decision to enter Indonesia was not influenced by Apple’s presence in the country and expressed confidence in Honor’s competitive capabilities. He mentioned that Honor had been monitoring the Indonesian market for years before intensifying expansion efforts in the past six months.
While Li did not disclose the current ratio of Indonesian to Chinese staff, he mentioned that Honor is actively recruiting in the country and aims to have a predominantly local workforce in the future.
Honor plans to establish at least 10 of its own stores in Indonesia this year, in addition to partnering with a local retailer for sales.
Beyond China, Honor primarily operates in Europe and parts of Southeast Asia, with no direct sales of its phones in the U.S. The company reported that in December, over half of its sales came from outside China for the first time.
Honor, which is preparing for an initial public offering, was separated from Chinese telecommunications giant Huawei in November 2020 following U.S. sanctions on the parent company. Huawei clarified that it has no shares in Honor and is not involved in its business decisions.
