Apple announced price cuts on its iPhone models in China including the iPhone X, iPhone 7 and 8. Other Apple products such as the iPad, AirPods, and Macs will also be sold at lower prices. People who already bought the select item models in the past 14 days will also be issued a refund.
According to CNBC, Apple slashes the prices after China declared changes in its tax policy that lower value-added tax for manufacturing companies like Apple. It was mentioned that China cut at least 3 percent from its original tax rates and this led the American tech giant to drop its prices by as much as 6 percent.
The news outlet noted that based on Apple's China website, iPhone XR is now available for just ¥6,199 which is 4.6 percent cheaper compared to its price on March 29. iPhone XS and iPhone XS Max are also on sale for just around $74.50 after the ¥500 price cut.
At any rate, Apple is also making this move in order to boost its sales as well. Due to the growing competition in China, the company admitted that its market experienced slow down after rivals snatched top spots in the leader board in sales.
China's Huawei emerged as the market leader in the last quarter of 2018 in the smartphone division. It garnered 28 percent market share as per Counterpoint Research. Oppo placed second with 20 percent while Vivo secured the third spot with 19 percent.
Apple only got 12 percent, effectively making the company as the fourth leading smartphone retailer. The sales drop was actually acknowledged by Apple's CEO Tim Cook earlier this year. He published a letter via the company's website and revealed the situation to its investors.
"While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in Greater China," Cook wrote. "In fact, most of our revenue shortfall to our guidance, and over 100 percent of our year-over-year worldwide revenue decline occurred in Greater China across iPhone, Mac, and iPad."
He added, "China's economy began to slow in the second half of 2018. Lower than anticipated iPhone revenue, primarily in Greater China, accounts for all of our revenue shortfalls to our guidance and for much more than our entire year-over-year revenue decline."
Tim Cook further said that despite these challenges, Apple believes that its business in China still has a bright future. Finally, amid the sales slow down, the company also took other steps to counter the decline. It recently announced that it expanded its services business by introducing its own digital subscriptions in news, TV, and gaming.
