Chinese consumers are favouring Huawei as Apple sales slump

By Rhod Mackenzie

There is mounting evidence that Apple is losing its Chinese customer base. Primarily, this pertains to the newest iPhone 15 model, which has not been selling well in this crucial foreign market. Its sales declined by 6% in September compared to the previous year, according to the research firm GfK. Furthermore, another research company, IDC, indicates that Apple phone sales decreased by 4% in the third quarter.

The intriguing aspect of this news is that two research firms have identified the Chinese telecommunications and mobile phone equipment manufacturer, Huawei Technologies Co., as the primary "culprit" of Apple's woes. Huawei's latest mobile phone model, the Mate 60, was released in September at around the same time as the iPhone 15 and has already sold nearly 1.5 million units, more than doubling the previous year's sales figures despite component supply issues, according to GfK.

"The iPhone 15 experienced a 6% drop against the backdrop of Huawei's strong sales growth," says Hayden Howe, a senior analyst at GfK that Bloomberg quotes, "Huawei Mate 60 sales will continue to thrive in the future."

Huawei, as a reminder, recently released its Mate 60 and 60 Pro just weeks before the launch of the latest iPhone 15 model. The latest release from the technology behemoth from China comes equipped with a cutting-edge Kirin processor, produced domestically and currently deemed the most powerful worldwide. An additional benefit of this device is that it reveals Chinese producers are unafraid when it comes to American sanctions.
Preliminary estimates by Counterpoint Research and Jefferies suggest that Apple's sales could drop by double digits due to China's economic woes, which are adversely affecting Chinese purchasing power and demand. Although the iPhone 15 received several significant updates, it failed to generate considerable interest in the planet's biggest smartphone market. China constitutes nearly 20% of all of Apple's income. Based on this metric, the Chinese market ranks second only to the American market. It is worth noting that nearly all iPhones are manufactured in China, and Foxconn Technology Group is the primary partner of the wealthiest company on the planet.
Apple is currently experiencing significant losses as a result of the deteriorating relationship between the US and China. Beijing has broadened its prohibition of iPhones to a number of governmental departments and agencies.

To decrease its reliance on China, Apple is searching for ways to boost production in areas such as India and Southeast Asia. The long-term ramifications of this move are currently ambiguous. In October, Beijing opened an inquiry into Foxconn's tax payments and land use. Naturally, the issues faced by the primary iPhone manufacturer have exacerbated Apple's position in China.

The most recent IDC analysis showed that the top selling brands in the second quarter were Chinese companies, namely Honor Device Co. and Oppo. It is worth noting that Honor split from Huawei in 2020.