Apple Inc. has taken an unusual step by offering discounts of up to 500 yuan ($70) on its latest iPhones in China, marking a rare move that has triggered concerns about diminishing demand for its flagship device.
According to a Bloomberg report, the discounts, introduced on Apple’s official website in China, are valid from January 18 to January 21, strategically timed ahead of the Lunar New Year shopping season.
This price reduction, equivalent to approximately 5 per cent off its top-tier iPhone models, signals a departure from Apple’s traditional pricing strategy in the region.
The decision to slash iPhone prices comes in the midst of changing consumer preferences in China, where local brands like Huawei Technologies Co. are gaining popularity.
Apple’s latest iPhone 15 faced disappointing sales compared to its predecessor after its debut in China last year, a trend attributed to a growing affinity for homegrown brands and the imposition of restrictions on the use of foreign devices in state-backed agencies and companies.
Jefferies’ warning about a potential 30 per cent drop in 2023 iPhone sales in China adds to the apprehensions surrounding Apple’s market position.
Analysts suggest that the introduction of Huawei’s Mate 60 series with a 7-nanometer made-in-China processor, seen as a national breakthrough despite US sanctions, contributed to the decline in iPhone sales in the region.
Apple’s move to discount its latest iPhones in China is a notable shift, considering its longstanding practice of refraining from price cuts on its newest devices.
The Lunar New Year discounts, a customary practice for Apple, have typically excluded the latest iPhone models. However, this year’s offerings encompass discounts on the iPhone 13 to the iPhone 15 Pro Max, reflecting the company’s acknowledgment of market dynamics and the need to bolster demand.
Apple’s Chinese retail partners have previously offered more substantial discounts on the latest iPhones, but the Cupertino-based tech giant has now directly embraced the practice.
The discount initiative extends beyond iPhones, including the MacBook Air, various iPad models, select AirPods, and the Apple Watch SE. The MacBook Air, in particular, is witnessing a significant markdown, with Apple reducing its price by up to 800 yuan.
(With inputs from Bloomberg)
