Apple has initiated an unconventional discount program in China, responding to heightened competition in the world’s largest smartphone market by reducing retail prices of select iPhone models by up to 500 yuan ($70). The price cuts, equivalent to a 5% reduction, were announced on Apple’s Chinese website and are part of a limited-time Lunar New Year event from January 18 to January 21.
The move comes as Apple faces challenges in China, where sales of its latest iPhone 15 series have lagged behind earlier models. Intense competition from domestic rivals such as Xiaomi and Huawei, coupled with restrictions on Apple device usage by some businesses and government agencies, has contributed to this decline.
Analysts from Jefferies noted a 30% drop in Chinese iPhone sales in the first week of 2024 compared to the same period the previous year, following a 3% decrease for the entirety of 2023.
This marks a departure from Apple’s usual strategy of maintaining stable prices for its latest iPhone models. The unexpected September launch of the iPhone 15 series was followed by online retailers, including Pinduoduo, offering discounts of up to 16% since the beginning of the year.
Nicole Peng, senior vice president of market research firm Canalys, remarked that these discounts were anticipated given Apple’s global sales push, especially in China, where competition is fierce, and consumer reluctance to upgrade is growing. Peng highlighted Huawei’s resurgence, suggesting that some Chinese consumers might opt for Huawei driven by patriotic sentiments.
Canalys predicts Apple’s global sales to remain steady this year but anticipates a slight decline in China. The price reductions reflect Apple’s strategic response to the evolving dynamics of the Chinese smartphone market and the need to address changing consumer preferences and increased competition.
