Apple cuts iPhone prices in China to compete with rivals like Huawei and others

Apple, the U.S. tech giant listed on the NASDAQ stock exchange under the ticker symbol AAPL, has started a promotional campaign on its official Tmall website in China. This campaign offers discounts of up to 2,300 yuan, approximately equivalent to $318 in United States currency, on selected models of iPhones. The promotional period spans from May 20 to May 28, as reported by Reuters.

This marketing move by Apple follows a trend in February, where resellers of Apple products in China were observed cutting prices of iPhone 15 models by as much as $180. Such price adjustments were seen as a response indicating decline in demand for iPhones, indicating a challenging market scenario for Apple in China.

Notably, Apple had been experiencing a decrease in its share of the smartphone market in China. According to the International Data Corporation, in the first quarter of 2024, Apple slipped to the third position in China’s smartphone market, with local competitors Honor and Huawei Technologies leading the market.

Data from Counterpoint Research also revealed a significant decline of 19% in Apple’s smartphone shipments in China during the first quarter of 2024. To address this decline, Apple introduced significant discounts across various iPhone models as part of its promotional strategy. The most considerable discount is applied to the 1TB variant of the iPhone 15 Pro Max, with other models also seeing notable price reductions.

The impact of Apple’s discounting efforts is evident in the increase of sales of iPhone shipments in China, which rose by approximately 12% in March. This positive outcome resulted in the adjustment in prices made by both Apple and its retail partners. Notably, this increase in shipments marks an improvement from the preceding two months of 2024, during which Apple saw a significant decline in sales amounting to 37%.

In the global smartphone market, Apple faced stiff competition and challenges in the first quarter of 2024. According to Canalys, a renowned research firm, Apple lost its position as the top smartphone vendor to Samsung, slipping to second place. This shift was accompanied by a double-digit decline in Apple’s smartphone sales, reflecting the challenges encountered in its core markets.

Apple’s promotional campaign in China, offering discounts amidst declining market share and shipments in the country have contributed to a positive upturn in iPhone shipments, indicating the effectiveness of strategic pricing adjustments in managing demand. Nevertheless, Apple continues to face competition and market challenges, both domestically in China and globally, as evidenced by its recent position in the global smartphone market rankings.

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