Apple’s dominance in China’s smartphone market came to an end in 2024 as local brands Vivo and Huawei overtook the tech giant, according to a report by research firm Canalys. The data revealed a 17% decline in Apple’s annual shipments in China, marking its largest-ever sales drop in the country.
Market Share Shifts
Budget smartphone maker Vivo captured 17% of the Chinese market, while Huawei secured a 16% share, surpassing Apple’s 15%. This significant decline underscores Apple’s growing struggle to compete with innovative domestic brands in one of its most crucial markets.
Declining Competitiveness
The report highlighted several reasons for Apple’s poor performance:
- AI Features Gap: The lack of artificial intelligence capabilities in the latest iPhones put Apple at a disadvantage in a market where AI is a strong selling point.
- Rival Innovations: Huawei’s flagship devices and the rise of foldable phones from Android brands like Vivo and Xiaomi have captured consumer attention.
- Huawei’s Comeback: Huawei re-entered the premium segment with a strong showing, posting a 24% increase in shipments in Q4, thanks to locally-made chipsets.
“This marks Apple’s worst annual performance in China,” said Canalys analyst Toby Zhu. “Huawei and other domestic brands are increasingly challenging Apple’s premium market position.”
Apple’s Response to Declining Sales
Apple has tried to counter its declining sales with aggressive promotions. From January 4-7, the company offered discounts of up to 500 yuan ($68.50) on its iPhone 16 models. Major e-commerce platforms like Alibaba’s Tmall also joined the effort, providing price cuts of up to 1,000 yuan ($137).
Growth Among Competitors
Other Chinese brands also saw significant growth:
- Xiaomi achieved the highest Q4 shipment increase at 29%.
- Oppo and Vivo posted gains of 18% and 14%, respectively.
Conclusion
The shifting dynamics of China’s smartphone market highlight Apple’s challenges in maintaining its dominance. The rise of local competitors, equipped with cutting-edge technology and competitive pricing, has reshaped consumer preferences. For Apple to reclaim its crown, the company will need to innovate and adapt to the rapidly evolving demands of China’s tech-savvy consumers.
