Retailers Are Slashing IPhone Prices Across China As Consumers Say The Phones Aren't Worth The Cost

In a public letter released on Jan. 2, Apple CEO Tim Cook blamed the slowing Chinese economy and rising trade tensions with the U.S. as one of the key reasons for lowering first quarter sales guidance. Experts, however, told CNBC that much of the iPhone's China problem comes down to the company setting the wrong prices.

For example, Apple's 512GB iPhone XS Max, the most expensive of the new models, costs $1,499 in the U.S. But in Asia's largest economy, the un-discounted price is 12,799 yuan, or nearly $1,900 — a more than 26 percent premium. Other variations of the latest iPhone models have similar price premiums in China.

Of note, the XR was meant to be the cheapest of the new models, but it has proven to be too pricey for many Chinese consumers — who were asked to pay a 28 percent premium compared to American buyers.

"The trade war is background noise and more of a scapegoat excuse with the real issues being iPhone XR demand and a mispriced product in a competitive Chinese market," Daniel Ives, managing director of equity research at Wedbush Securities, told CNBC by email.

Source : https://www.cnbc.com/amp/2019/01/11/apple-iphone-retailers-are-slashing-prices-across-china.html

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Retailers are slashing iPhone prices across China as consumers say the phones aren't worth the cost