New figures are available for the Chinese smartphones market – and they are a disturbing sign for Apple.
The global shipping of smartphones in China increased by 3.3% in the first quarter, according to a research report Thursday of the International Data Corporation, but iPhone shipments notably dropped by 9% from one year to the next.
Apple was the only large manufacturer of smartphones to lose market share during the quarter, according to IDC.
Local rivals have dominated the Chinese market, a key region for Apple that CEO Tim Cook called “the most competitive market in the world”, motivated by government grants that include smartphones.
Analyst IDC Will Will wrote that the relatively high price of the iPhone meant that Apple was widely excluded from the growth fueled by subsidy.
Apple smartphones expeditions in China “have decreased while its premium price structure prevented it from capitalizing on subsidies,” said Wong in the IDC report. Apple iPhones represented 9.8 million, or 13.7% of the 71.6 million smartphones sent in the first quarter.
Local Rival Xiaomi, on the other hand, has resumed first place for the first time in almost a decade with a 39.9% increase in expeditions, which represents 13.3 million units of the total expeditions.
In January, the Chinese government extended subsidies intended to stimulate consumption expenditure on smartphones and other technological devices. The advantage is capped in products of less than 6,000 yuan, or $ 821, which makes apple phones too expensive for consumers to have 15% of the sale covered.
An iPhone 16 pro, for example, starts at 7,999 yuan, or $ 1,095. Manufacturers of local smartphones, such as Xiaomi and Huawei, have more affordable models that can be reduced using the advantage.
Government subsidies are not the only challenge that Apple is faced with in China. The 145% tariff of President Donald Trump on Chinese goods is still suspended above his head, although Apple devices are temporary exempt from the higher rate. China is the largest Apple supply chain center for iPhones. While Trump largely gave the technological industry a break in the highest rate rate for goods produced in China, he later declared that companies like Apple would be subject to separate rates on the line.
“For the future, the market is expected to deal with challenges, as US-Chinese trade tensions can cause more strict cost and consumption budgets,” said Arthur Guo, main research analyst at IDC.
Apple has a lot of land to catch up in the country when its figures continue to indicate that the iPhone loses its foot. Its share of the smartphones market in China for the fourth quarter of 2024 was 17% – down 21% compared to the previous year.
The iPhone giant publishes its report on the results of the first quarter on May 1, which will give Wall Street a better overview of how the company takes place on the highly competitive market.
businessinsider
