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China's smartphone market continues to shrink in 2024, and local resellers like Huawei overtook Apple's iPhone.
After being ranked No. 1 overall in China in 2023, Apple fell to fourth place in the first six weeks of 2024, according to Counterpoint Research. However, the post-holiday period is always accompanied by a significant drop in sales for all resellers, and what may be more significant is the decline in the Chinese smartphone market.
Apple's success in the final quarter of 2023 led to what appeared to be an end to years of decline in overall sales in China. China's market contracted 7% year-on-year in the first six weeks of 2024, according to the latest data from Counterpoint.
However, Counterpoint notes that during the same period in 2023, “abnormally strong performance was recorded, with significant unit sales delayed from December 2022 due to production issues, further exacerbating the negative comparison compared to the same period last year.”
Comparison of leading Chinese smartphone manufacturers compared to last year (Source: Counterpoint)
Counterpoint publishes comparative data on the growth or decline of individual brands in China, but this is nonsense. It shows Huawei up 64% and Apple down a whopping 24%, but those numbers aren't even remotely comparable.
What's more telling and helpful is that Apple's 24% drop comes from a 19% market share at the same point in 2023, which is now 15.7%. At this point in 2023, Huawei's share was 9.4%, and now it is 16.5%.
“First of all, [Apple] faced stiff competition at the top end from a resurgent Huawei, while being squeezed in the middle by aggressive pricing from the likes of OPPO, vivo and Xiaomi,” said Mengmeng Zhang, a senior analyst. . “While the iPhone 15 is a great device, it doesn't offer significant upgrades over the previous version, so consumers feel fine holding on to the older generation iPhone for now.”
In these numbers, Huawei is ahead of Apple, but only slightly and not as noticeably as the 64% increase versus a 24% decline suggests.
The top-selling smartphone maker in China in the first six weeks of 2024 was Vivo with a market share of 18%. Huawei came in second place, followed by Honor with 16%.
Counterpoint analysts attribute Vivo's success to how it has targeted the more cost-conscious end of the smartphone market. It also said overall sales have fallen due to a lack of consumer confidence.
While this is not the end of the downturn that Counterpoint had hoped for, there is still some good news to come.
“The previous year period was already quite depressed, but as far as Apple is concerned, there is more room for maneuver in the short term,” said analyst Ivan Lam. “Aggressive promotions ahead of Women’s Day are just one example.”
Friday, March 8, is Women's Day in China. In anticipation of this day, major resellers in the country are reducing prices on the iPhone 15 line.
