Have you ever bought a new Apple phone at a discount? For most people, the answer is no. This is because Apple doesn't really offer discounts.
But in China, Apple is cutting the price of some of its latest iPhones by $70 amid concerns that Chinese consumers have cooled on the brand. That would save the buyer 6 to 8 percent, based on prices on Apple's China website. It has also reduced the price of some MacBook Air laptops by $112. The sale will begin on Thursday and will run until Sunday.
Cutting prices on high-end electronics for buyers in China is an unexpected move for Apple, highlighting the challenges the American company faces in China, where patriotic shoppers are choosing domestic brands amid rising tensions between United States and China.
Apple and its Chinese rival Huawei are on the front line of a technology battle between Beijing and Washington that has seen both countries restrict access to foreign technology. Long suspicious of Huawei's close ties to the Chinese government and fearing its technology could be used for spying, U.S. officials have prevented federal agencies from purchasing Huawei equipment and have also tried to discourage other countries.
China, for its part, has issued directives to some of its government employees not to use iPhones at work and has encouraged domestic brands.
An eye for an eye is not good for business. Apple has a lot to lose from rising tensions between the United States and China, a huge market that accounts for a fifth of its total revenue.
Overall smartphone sales in China fell by around 3 percent in 2023 due to the slowdown in the country's economy. It is also the only major economy to sink into deflation as the Chinese cut spending and household savings rose to a peak.
Huawei has taken aim at Apple's market share in China and recently unveiled 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 had fallen 2.5 percent. The company has reported declining sales for three quarters over the past year.
Discounts are not unusual ahead of the Lunar New Year, which is next month and one of the biggest shopping periods of the year in China. Apple's current promotion includes an image of a giant dragon made from iPhones, Apple Watches and AirPods, in a nod to the upcoming Year of the Dragon in the Chinese zodiac.
The discounts sparked debate 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 known as Victorious Zhang Beihai. Another commenter wrote: “Still too expensive. I support national telephones.”
Apple's Lunar New Year promotion is “a move that was not commonly seen in the past,” said Toby Zhu, senior analyst at Canalys, a market research firm. Canalys research indicates that Apple's sales in China fell last summer compared to 2022, but that the company still holds about 66 percent of the high-end smartphone market in China.
Mr. Zhu added that the iPhone models on sale appear to have already sold out.
Still, he added, “it does indicate the challenges Apple faces in the mainland China market.”
