Why Apple is offering rare iPhone discounts in China

Shoppers in China are getting rare discounts on iPhones as Apple faces increasing competition from local brands.

The four-day promotion, which starts this Saturday (January 4), includes discounts of as much as 500 yuan ($68.50, £55.30) on some of the US tech giant’s latest handsets.

Chinese phone maker Huawei has also cut the prices of its high-end mobile devices by as much as 20%.

The discounts come as consumers in China remain hesitant to spend due to the country’s economic challenges.

The offer covers Apple’s top models as well as older handsets and some other devices.

The largest discount of 500 yuan will apply to Apple’s flagship iPhone 16 Pro, which has a starting price of 7,999 yuan, and the iPhone 16 Pro Max, which currently costs 9,999 yuan.

The firm ran a similar campaign in China last year ahead of the Lunar New Year holiday. This year the festival starts at the end of January.

“Apple’s strategy has changed to adapt to the change in the shopping behavior of Chinese consumers,” said Will Wong, senior research manager for market intelligence firm International Data Corporation (IDC).

“The value-seeking trend has made price discounts more attractive to consumers. Apple may fall behind other competitors if it does not adopt such a pricing strategy.”

The discounts offered by Apple and Huawei reflect a broader trend in China.

From online retail giants to the country’s automakers, deals are being offered in a bid to attract customers who have been reluctant to spend as the world’s second-largest economy slows.

Against this background, Apple’s share of the Chinese market has come under increasing pressure from local rivals such as Vivo and Xiaomi.

The US firm re-entered China’s top five smartphone makers in the third quarter of 2024 after briefly falling off the list.

According to IDC’s latest survey, Vivo was China’s best-selling smartphone maker during the period, as sales increased by more than 20%.

In the same period, Apple experienced a drop in sales of 0.3 per cent. Huawei has increased by more than 40 per cent.

“We’ve seen market competition increase with almost everyone launching a flagship last quarter,” said Ivan Lam, senior analyst at Counterpoint Research.

Huawei has seen an increase in demand for its products after returning to the premium smartphone market last August.

The Shenzhen-based company has since launched several new devices powered by advanced technology despite the company facing US restrictions.