Apple stops online sales in Russia as the ruble drops to new lows

Apple stops online sales in Russia as the ruble drops to new lows
Apple has stopped online sales in Russia as the sharp decline in the ruble has led to a financial crisis in the country. On Tuesday, the Russian currency collapsed as much as 20% against other currencies, despite efforts by Russia's Central Bank to stop the decline. Economics 101 calls for hikes in interest rates as a way to attract buyers to a free-falling currency, and the Russian Central Bank hiked rates sharply. The ruble has declined 60% this year.

Foreign companies doing business in Russia, like Apple, are finding that the rubles they collect from Russians purchasing their wares, are worth a lot fewer dollars when converted. As a result, proper business doctrine would suggest that Apple raise the prices of the devices it sells on its Russian online store. For example, last month Apple raised the price of the Apple iPhone 6 by 25% in Russia.

With the ruble declining so sharply, Apple would need to keep reviewing the pricing on its online store in Russia to prevent it from taking currency losses on its sales. Instead of changing prices numerous times a day, Apple came to the decision that it is in its best interest, and the best interests of its customers, to just halt sales for the time being. Otherwise, Apple would have to price itself out of the market in Russia.




source: CBS, TheGlobeandMail

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23 Comments

1. JGuinan007

Posts: 699; Member since: May 19, 2011

What does rain in California have to do with Russian Rubles and IPhone sales?

4. fzacek

Posts: 2486; Member since: Jan 26, 2014

Lol, I know, right?...

8. Aploine

Posts: 444; Member since: Oct 24, 2013

It's symbolic, the flud of rubles. Soon in your country too! Also see who sponsors CBS. Blackrock, the destroyer of national economies. So the flud of black propaganda.

21. ggg377

Posts: 20; Member since: Oct 16, 2014

Russia's economy has been plummeting for the past 6 months and you guys were too busy ignoring all the signs. My country's economy isn't plummeting, so nothing like this will happen here any time soon. Most of Russia's budget revenue sits in oil and now that oil prices are tanking, so is the economy. Add in the effect of foreign capital leaving and no loans due to sanctions and you have a recipe for disaster.

22. JGuinan007

Posts: 699; Member since: May 19, 2011

What can I do to help?

2. HugoBarraCyanogenmod

Posts: 1408; Member since: Jul 06, 2014

Many of my customers are going to travel to Moscow and buy some cheap luxury goods and they invited me in as well. Thanks to rubles drop, everythings there are cheap. We're here to boost Russia economy

11. corporateJP

Posts: 2458; Member since: Nov 28, 2009

LOL...okay...buy me a gold-framed picture of Putin wrestling that wild Grizzly...

3. fzacek

Posts: 2486; Member since: Jan 26, 2014

I see no reason for them to stop selling it there, as the drop of the ruble pretty much compensates for the overpriced-ness of the iPhone...

7. joey_sfb

Posts: 6794; Member since: Mar 29, 2012

Apple is not earning going less for nobody sake. Otherwise people like me will order a few containers of iPhone iPad.

20. Martin_Cooper

Posts: 1774; Member since: Jul 30, 2013

They are not stopping the sales of apple products in Russia. LOL they just paused them until they figure out when will the ruble stop goin down like crazy so they can resume with new adjusted prices.

5. greenelektron

Posts: 537; Member since: Sep 10, 2014

rubles rumbling down. But why Apple did not slash its price in countries that has their currencies shooting up? Not playing fair huh.

9. Taters

Posts: 6474; Member since: Jan 28, 2013

Exactly, when currencies go up they just pocket it. When it goes down the consumer has to pocket it. Sure all companies do this but that is because they have to. Apple has over a 100 billion in liquid assets and they still can't pass anything to the consumer. No one should support this company. It's ridiculous.

10. pwnarena

Posts: 1129; Member since: Feb 15, 2013

think like a businessman and you'd realize why they do things that way. besides, why should they feel obliged to price their products according to how economies/currencies move? what they're selling is not a basic necessity. nobody's forced to buy iphones and ipads. it's not food or fuel. they can price their products to get the best profits possible.

19. TheOldOne

Posts: 196; Member since: Mar 29, 2012

some good point you're making here, but even for basic necessity it does not work this way. In my country, the gas price will immediately go up when the petrol proce increase (is like they don't have any stoc), but when the price goes down, like these days, you barely see it at the pump.

12. Cyberchum

Posts: 1011; Member since: Oct 24, 2012

+100,toy nailed it.

13. Cyberchum

Posts: 1011; Member since: Oct 24, 2012

Autocorrect to blame there, you nailed it.

14. ManusImperceptus

Posts: 724; Member since: Jun 10, 2014

They obviously will at some point; otherwise citizens in said countries will start ordering Apple products from abroad. It's the same effect, only it's impact is obviously doesn't hit as hard and fast...

6. Dingy_cellar_dweller

Posts: 339; Member since: Mar 16, 2013

'Apple would have to price itself out of the market in Russia.' So they just did what they were worried about doing, I don't get it but then I'm not payed millions a year so what do I know.

15. ManusImperceptus

Posts: 724; Member since: Jun 10, 2014

Obviously they're worried about image (pricing an iPhone at the level of a car) and the risk of the Rubel loosing value so fast as to be practically worthless in the near future...

16. ManusImperceptus

Posts: 724; Member since: Jun 10, 2014

A very good indicator that sanctions as a result of Russian foreign policy are having an effect...!

17. Wiencon

Posts: 2278; Member since: Aug 06, 2014

Now Apple has to do is to wait for the nuke.

18. wando77

Posts: 1166; Member since: Aug 23, 2012

Hmmmmm mm. ...... funny how this happens a month before russia ban the iphone there

23. Zylam

Posts: 1771; Member since: Oct 20, 2010

Poor Russians, hope everyone makes it through these tough times. Russia must be a really hard place to live and just get by.

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