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Apple could be facing an "informal boycott" from consumers in China

By Joshua Swingle

Published: Jan 08, 2019, 7:21 AM

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Apple could be facing an "informal boycott" from consumers in China

The iPhone XR and iPhone XS Max

While Apple blamed its slowing iPhone sales on China’s weaker economy, certain industry analysts believe the company’s high prices are at fault. But in a new report, economists at Bank of America Merrill Lynch suggest Chinese consumers could be the cause.

With the US and China trade war showing no signs of drawing to a close, it’s claimed that the “spillover from politics” into smartphone sales is particularly high. This has seen local companies encourage consumers to stay away from foreign brands, a move which, according to the report, has led to what is being called an “informal boycott” of US products.

This so-called boycott is significantly affecting demand for Apple’s iPhones in the market. But to make matters worse, it’s being combined with a weaker yuan. Essentially, this means that the dollar value of earnings overseas is reduced, something that further impacts the company’s bottom line.

Fortunately for Apple, the Chinese economy is expected to pick up in early Spring – this could help improve sales – but it seems the US economy may continue to slow past this period. Thus, the benefits of improved performance in China may not be felt.

On a related note, surveys conducted have revealed that consumers in India are showing less interested in Apple’s products too. Here, it is market leaders Samsung and Xiaomi that are capturing the attention of consumers with lower prices and innovative features. As a direct result of this, it seems Apple requires a total strategy rethink in the region.

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