Apple’s iPhone discounts fail to boost market share in China: What’s next for the tech giant?

Apple’s aggressive discounting strategy in China appeared promising earlier this year. During an online shopping festival in May, the tech giant offered significant price cuts on its iPhones, aiming to boost sales and counteract its faltering performance in the region. 

Despite these efforts, Apple’s iPhone sales in China remain sluggish compared to its local rival Huawei, and recent data suggests that these discounts have not significantly altered the broader market trends.

Apple’s iPhone shipments in China show minimal improvement

In the second quarter of 2024, Apple shipped 9.7 million iPhones in Mainland China, a slight decrease from the 10 million units shipped in the first quarter. 

This represents a reduction of 6.7% compared to the same period last year, according to Canalys research reviewed by Reuters. 

While the decline is less severe than the 25% drop observed in the first quarter of 2024 compared to the previous year, it highlights a persistent issue for Apple in the Chinese market.

Huawei’s dominance continues to grow

Apple’s struggles are set against a backdrop of Huawei’s resurgence. 

The Chinese tech giant saw a remarkable 41% increase in smartphone shipments for the three months ending June 30. 

Huawei’s growth underscores the challenges Apple faces as it attempts to compete with a dominant local player that benefits from both strong brand loyalty and competitive pricing strategies.

Apple’s shift towards other Asian markets

In response to its difficulties in China, Apple has intensified its focus on other Asian markets, particularly India and Vietnam. 

The company’s sales in India have surged since the opening of its first physical store in the country just a year ago. 

Apple is also working to diversify its supply chain by building stronger relationships with partners in India and Vietnam, aiming to reduce its reliance on China.

CEO Tim Cook’s efforts to maintain China ties

Despite the challenges, Apple CEO Tim Cook remains committed to the Chinese market. 

In March, Cook traveled to China to engage with developers and suppliers, reflecting the company’s ongoing interest in maintaining and potentially strengthening its position in one of its most significant markets. 

However, the effectiveness of these efforts remains to be seen as Apple continues to face intense competition from local brands like Huawei.

Apple’s pricing strategies and market adjustments highlight the company’s efforts to adapt to a rapidly changing competitive landscape in China. 

However, with Huawei’s continued growth and strong performance, Apple faces an uphill battle. The company’s success in other Asian markets and its strategic supply chain adjustments may offer some relief, but the overarching challenge of competing against well-established local competitors remains a key issue.

The post Apple’s iPhone discounts fail to boost market share in China: What’s next for the tech giant? appeared first on Invezz