Produced by | Huabo Business Review

Since taking over as Apple's CEO in 2012, Cook has frequently visited China, accumulating a total of 17 visits across multiple regions. This year alone, he has made two trips. However, despite Cook's frequent "goodwill" visits, iPhone sales in China have not significantly increased.

Faced with fierce competition from local smartphone manufacturers like Huawei, Apple's revenue in Greater China has declined for four consecutive quarters. According to the latest Canalys data for the third quarter of 2024 on China's smartphone market, Apple's shipments in the Chinese mainland declined by 6% year-on-year, falling to fifth place.

01

Packed itinerary, just to promote sales?

On October 21, Cook arrived in Beijing again, his second visit to China this year. This visit was packed with activities, almost all centered around the latest product, the iPhone 16.

On October 21, in a Beijing hutong, he joined photographer Chen Man to take photos using the iPhone 16 Pro Max. Cook tweeted on Weibo, "I appreciate how she uses the iPhone 16 Pro Max to capture the beauty of Beijing."

The next day, Cook visited an organic farm in Shunyi, Beijing, where he interacted with three students about Apple's "Tech for Good" project. On Weibo, Cook said, "We are committed to empowering communities and creating opportunities. I was delighted to meet students from China Agricultural University and Zhejiang University to learn how they use iPhones and iPads to help farmers promote more efficient and sustainable agricultural practices."

On the afternoon of the 22nd, Cook appeared at the Apple Store in Wangfujing, shaking hands with customers wearing Vision Pro and demonstrating the product's high-definition VST perspective effect and Apple's MR vision. This undoubtedly boosted the promotion of Vision Pro in the Chinese market. On the same day, Cook also met with musician Liu Boxin and sports game company Wangchen Technology, promoting the music creation capabilities and chip performance of the iPhone.

On the 23rd, Cook met with Minister of Industry and Information Technology Jin Zhuanglong to discuss Apple's development in China, network data security management, and cloud services. He then met with Chairman of China Mobile Yang Jie to discuss digital content, 5G product cooperation, and especially mentioned future cooperation plans for Vision Pro. Cook also visited Sina Weibo to respond to questions about when "Apple Intelligence" would enter China, stating that they were actively promoting relevant work.

On the 25th, Minister of Commerce Wang Wentao met with Cook to discuss Apple's business development in China and China-US economic and trade relations.

According to industry experts, a crucial objective of Cook's visit may be to propel Apple Intelligence into the Chinese market. Some also believe that given the underwhelming market performance of Apple's latest products, Cook's visit aimed to strengthen ties and foster relationship development in the Chinese market.

02

The allure of the iPhone fades

On the same day as Cook's visit, the iPhone 16 series, which had only been released for a month, saw price reductions.

During this year's "Singles' Day," the Apple Store's official flagship store on Tmall offered significant discounts, with savings of up to 1,600 yuan on the iPhone 16 series.

Specifically, the prices after coupons for the iPhone 16, iPhone 16 Plus, iPhone 16 Pro, and iPhone 16 Pro Max were 500 yuan lower than their original prices. Additionally, Apple offered trade-in subsidies of up to 1,100 yuan, allowing consumers to save up to 1,600 yuan on the iPhone 16 series with combined discounts.

Notably, this is not the first time Apple has reduced prices for its new models, but the speed and magnitude of this year's reductions surpassed previous years. Last year, after the launch of the iPhone 15 series, official price reductions occurred four months later, with a maximum discount of 500 yuan. In contrast, the iPhone 16 series saw price reductions just one month after its release, reflecting Apple's helpless response to declining sales in the Chinese market.

Since 2024, Apple's sales in China have continued to decline, prompting multiple investment banks to downgrade Apple's rating. In the first fiscal quarter of FY2024, Apple's revenue in Greater China decreased by 13% year-on-year, well below Wall Street expectations. Sales data also showed that iPhone sales in the Chinese market declined by 24% year-on-year in the first six weeks of 2024, falling to fourth place nationally.

The importance of the Chinese market to Apple is self-evident. Over the past three years, China has been the primary driver of Apple's high growth. Simultaneously, China is also a critical supply chain base for Apple, with over 90% of iPhones globally manufactured in China. However, recent adjustments and shifts in Apple's supply chain have garnered global attention, with places like India gradually emerging as new production bases for Apple.

Against this backdrop, Cook's visit to China undoubtedly aimed to stabilize sentiment. He had to address both the reluctance of the downstream market and concerns about upstream supply chain instability.

Nevertheless, regardless of whether Cook will accelerate the "de-China" process or increase investment in the Chinese market in the future, consumers seem less concerned.

According to the latest report by International Data Corporation (IDC), in the third quarter of 2024, there was no significant change in market demand after the initial sales of Apple's new products, with iOS market shipments declining by 0.3% year-on-year. In contrast, domestic smartphone manufacturers like vivo, Huawei, and Xiaomi performed impressively, driving a 3.8% year-on-year growth in the Android market.