Have you ever purchased a discounted new phone from Apple? For most people, the answer is no. That’s because Apple doesn’t typically offer discounts.
But in China, Apple is reducing the price of some of its latest iPhones by $70 amidst concerns that Chinese consumers are less interested in the brand. This would save a buyer about 6 to 8 percent, based on prices on Apple’s China website. It has also cut $112 off the price of some MacBook Air laptops. The sale will begin on Thursday and run through Sunday.
Lowering prices on top-of-the-line electronics for buyers in China is an unexpected move for Apple, which highlights the challenges the American company faces in China, where loyal shoppers are opting for domestic brands amid escalating US-China tensions.
Apple and its Chinese competitor, Huawei, are at the forefront of a technology battle between Beijing and Washington, resulting in both countries restricting access to foreign technology. With American officials wary of Huawei’s connections to the Chinese government and concerned about potential spying, they have prohibited federal agencies from purchasing equipment from Huawei and have tried to discourage other countries as well.
On the other hand, China has issued directives to some of its government employees not to use iPhones at work and has promoted domestic brands.
This back-and-forth is detrimental to business. Given that China makes up a significant portion of its revenue, Apple has much to lose from the rising tensions between the United States and China. Overall smartphone sales in China dropped by about 3 percent in 2023 due to the country’s economic slowdown. It is also the only major economy experiencing deflation as the Chinese cut spending, causing household savings to rise.
Huawei has targeted Apple’s market share in China, recently unveiling a smartphone with an enhanced camera, a feature that Apple has long promoted as a selling point.
Apple stated in November that its overall sales in China had decreased by 2.5 percent. The company has reported a drop in sales for three quarters over the last year.
Discounts are not uncommon leading up to the Lunar New Year, which is next month and is one of the biggest shopping periods in China. Apple’s current promotion features an image of a large dragon made of iPhones, Apple watches, and AirPods, in reference to the upcoming year of the dragon in the Chinese zodiac.
The discounts sparked discussion on Chinese social media on Monday.
“Apple will only reduce the price of its phones when domestic phones become more popular,” wrote a well-known blogger named Victorious Zhang Beihai. Another commentator wrote: “It is still too expensive. I support domestic phones.”
Apple’s Lunar New Year promotion is “a move not commonly seen in the past,” said Toby Zhu, a senior analyst at Canalys, a market research firm. Canalys’s research indicates that Apple’s sales in China decreased last summer compared to 2022, but the company still holds about 66 percent of the market for high-end smartphones in China.
Mr. Zhu added that the models of iPhones under promotion appear to have already sold out.
Still, he added, “it does indicate the challenges Apple is facing in the mainland China market.”
