Did you buy a new phone at a discount from Apple? For most people, the answer is no. This is because Apple doesn't really offer discounts.
But in China, Apple reduced the prices of some of its latest iPhones by $70 amid concerns that Chinese consumers are dissatisfied with the brand. This would save the buyer about 6 to 8 percent, depending on prices Apple website in China. It's also cut $112 off the price of some MacBook Air laptops. The sale will start on Thursday and continue through Sunday.
Cutting prices on high-end electronics for buyers in China is an unexpected move for Apple, one that highlights the challenges the US company faces in China, as patriotic shoppers opt for local brands amid escalating US-China tensions.
Apple and its Chinese rival Huawei are on the front lines of the battle over technology between Beijing and Washington, which has seen both countries restrict access to foreign technology. US officials have long questioned Huawei's close ties to the Chinese government, worried that its technology could be used for espionage, blocked federal agencies from purchasing equipment from Huawei and tried to discourage other countries as well.
For its part, China issued directives to some of its government employees not to use iPhones at work and encouraged local brands.
An eye for an eye is not good for business. Apple has a lot to lose from escalating tensions between the United States and China, a huge market that accounts for a fifth of its total revenue.
Total smartphone sales in China fell by about 3 percent in 2023 due to the slowdown in the country's economy. It is also the only major economy to plunge into recession as the Chinese cut spending and household savings soar to a high point.
Huawei has targeted Apple's Chinese market share, recently unveiling a smartphone with an improved camera, something Apple has long touted as a selling point.
Apple said in November that its total sales in China fell by 2.5 percent. The company reported a three-quarter decline in sales over the past year.
The sales are not unusual ahead of the Lunar New Year, which falls next month and is one of the biggest shopping periods of the year in China. Apple's current promotion includes an image of a giant dragon made out of iPhones, Apple Watches and AirPods, a nod to the upcoming Year of the Dragon in the Chinese zodiac.
The cuts sparked controversy on Chinese social media on Monday.
“Apple will only lower its phone prices when local phones become more popular,” wrote a blogger known as Victorious Zhang Beihai. “It's still expensive,” another commenter wrote. I support home phones.
Apple's Lunar New Year promotion is “a move not commonly seen in the past,” said Toby Zhou, a senior analyst at Canalys, a market research firm. Canalys research indicates that Apple's sales in China declined last summer compared to 2022, but the company still owns about 66 percent of the high-end smartphone market in China.
Mr. Zhu added that the iPhone models being promoted appear to have already sold out.
However, he added, “this points to the challenges Apple faces in the mainland China market.”
Olivia Wang Contributed to reports.
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