Apple has joined China’s national subsidy program, providing discounts on select devices to customers in Beijing and Shanghai.

This decision follows increased competition from local rivals and an economic slowdown in the Chinese market.

In Shanghai, customers can receive discounts of up to 2,000 yuan (US$278) on iPhones, iPads, Apple Watches, and MacBooks when shopping at one of the city’s eight Apple Stores.

In Beijing, similar subsidies are available for online orders placed through Apple’s website, as long as the shipping address is within the city.

🔗 Source: South China Morning Post

🧠 Food for thought

1️⃣ Apple’s participation marks rare deviation from premium pricing strategy

Apple’s move to join China’s national subsidy program represents a significant strategic shift for a company that has historically avoided deep discounts to preserve brand perception and value.

The company has traditionally maintained strict pricing control similar to luxury retailers, as highlighted in their marketing excellence strategy 1.

This change comes amid dramatic market share losses in China, where Apple’s share has halved from 16% to 8% in the past year, with shipments falling from 5.77 million to 3.04 million units year-on-year 2.

Earlier this year, Apple already broke with tradition by offering rare direct discounts in China, including 500 yuan off the iPhone 16 Pro, signaling growing competitive pressure 3.

The move reflects Apple’s need to adapt to local market conditions where domestic brands are gaining ground through aggressive pricing and government support.

2️⃣ Government subsidy programs are reshaping China’s smartphone competitive landscape

The national subsidy program that Apple has now joined was specifically designed to stimulate domestic consumption, with significant implications for market dynamics.

The program offers 15% subsidies for smartphones priced under CNY6,000 (approximately $818), a threshold that initially favored domestic manufacturers with more affordable product lines 4.

Prior to Apple’s participation, most iPhone models were excluded from these government incentives, placing the company at a competitive disadvantage while boosting sales for local rivals 5.

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