Nintendo in an announcement said it is suspending sale of its consoles in Brazil because of country’s high import tariffs and taxes.
In an official statement, the company said:
“In response to ongoing developments in the Brazilian market, Nintendo of America Inc. today announced changes to the physical distribution of its products in that country. Starting in January 2015, Gaming do Brasil, a wholly-owned subsidiary of Juegos de Video Latinoamérica, GmbH, will no longer distribute Nintendo products in Brazil. Gaming do Brasil has distributed Nintendo products in the country for the past four years. Despite the changes in Brazil, Juegos de Video Latinoamérica will continue to be Nintendo’s distributor for Latin America and they remain committed to the brand and the region.”
“Brazil is an important market for Nintendo and home to many passionate fans, but unfortunately, challenges in the local business environment have made our current distribution model in the country unsustainable. These challenges include high import duties that apply to our sector and our decision not to have a local manufacturing operation. We will continue to monitor the evolution of the business environment and evaluate how best to serve our Brazilian fans in the future.”
Nintendo Wii U which costs $1,899 Brazilian Real in the Latin country which converts to 830 US dollars is costlier than what it sells in the other countries. Consoles like PS4 and Xbox One are too being sold for costlier prices with PS4 R$4000 deep hole in your pocket.
The high taxes and tariffs in the country are due to protection of local companies, forcing corporations to pull out like HTC and Durham in 2012. Another reason is to beef up local employment, because one way to avoid paying those taxes is to build factories in the country which companies like Apple have done to sell their iDevices. Microsoft too has a plant in the Amazonian country and that is the reason it sells cheap in Brazil.
Nintendo does not intend to open a plant in Brazil as the consoles haven’t sold too well in the country and the operations may cease to exist until taxes are relieved. Until then the fans will have to import the Nintendo consoles from other countries but that may too be a costlier options.
