Sales of foreign mobile phones in China plummeted 47.4% year-on-year in November, totaling just 3.04 million units, according to new data from the China Academy of Information and Communications Technology (CAICT). Apple, the dominant foreign brand in China, faces mounting challenges as domestic competitors like Huawei regain ground.
Huawei’s resurgence, driven by high-end smartphone launches and strong local support, has significantly outpaced Apple’s growth, according to research firm IDC. Apple’s latest iPhone 16 series, launched in September, includes new AI features via its Apple Intelligence software—but these features remain unavailable in China due to regulatory hurdles.
Local brands, meanwhile, are promoting AI-enabled devices already tailored for the Chinese market, intensifying the competition. In response, Apple plans to offer discounts on the iPhone 16 during the Lunar New Year to boost sales.
China remains a critical market for Apple, with CEO Tim Cook visiting the country multiple times last year to strengthen partnerships. However, as local brands continue to thrive and innovate, Apple faces growing pressure to adapt and maintain its market share.
THINK LIKE AN ECONOMIST!
- Define the term market share.
- Explain one reason why foreign brands like Apple are facing declining sales in China.
- Using a supply and demand diagram, analyse the impact of local competitors’ AI-enabled features on Apple’s market performance in China.
- Discuss whether regulatory hurdles in China could affect the global competitiveness of foreign smartphone brands.
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