In a recent report by Canalys, it was revealed that Apple has been edged out of the top five smartphone vendors’ list in China during the second quarter. This decline can be attributed to the increasing competition from domestic brands such as Huawei, which have been gaining momentum in the Chinese market. Apple’s market share in China has shrunk to 14%, down from 15% in the first quarter and 16% in the same period a year ago.
Apple, once the third-largest smartphone vendor in China, has now dropped to the sixth spot with approximately 9.7 million shipments. This marks a significant decline for Apple, whose shipments have been decreasing since the first quarter. The company experienced a 25% year-on-year drop in shipments during the first quarter.
Strategies of Chinese Vendors
According to Canalys research analyst, Lucas Zhong, Chinese vendors’ strategies for high-end products and their partnership with local supply chains are proving to be successful. Domestic brands like Huawei, Vivo, Oppo, and Xiaomi have been leveraging generative AI and innovative features to enhance the user experience of their devices. For example, Honor’s latest Magic V3 device has received positive feedback for its AI capabilities.
On the other hand, Apple is facing challenges in the Chinese market as it struggles to stabilize retail prices and protect the margins of its channel partners. The company is also encountering a “bottleneck” in terms of market penetration and competition with local brands that are aggressively incorporating AI into their products.
Resurgence of Chinese Brands
During the second quarter, Vivo reclaimed the top spot with a 19% market share and 13.1 million units shipped. Oppo maintained its second-place position with 11.3 million units sold, while Huawei’s spinoff brand, Honor, came in third with a 4% year-on-year increase in shipments. Huawei itself secured the fourth position with a 15% market share, followed by Xiaomi in the fifth spot.
Overall Market Growth
Despite Apple’s struggles, the Chinese smartphone market experienced a 10% year-on-year growth in the second quarter, with total shipments surpassing 70 million units. This growth can be attributed to the innovative strategies and competitive offerings from domestic brands, which have been able to capture a larger market share with their high-quality products. Apple will need to carefully consider its localization and AI strategies in China to regain its position in the highly competitive market.
Leave a Reply