Apple’s iPhone 16 models seeing discounts in China as AI delay softens demand – report

Online retailers in China have cut the prices of Apple’s (NASDAQ:AAPL) new iPhone 16 series ahead of its official launch, the South China Morning Post reported.

PDD’s (PDD) Chinese e-commerce site Pinduoduo began selling the iPhone 16 Plus with 512 gigabytes, or GB, of storage for 8,999 yuan (about $1,268), a 10% discount from the official price of 9,999 yuan. Meanwhile, the 128GB iPhone 16 is being sold at a larger discount of 11%, the report added.

Pinduoduo and Alibaba’s (BABA) Taobao marketplace have given a 4% discount on the 256GB iPhone 16 Pro Max, reducing the price by 400 yuan to 9,599 yuan. Alibaba’s Tmall shopping platform is offering buyers the option to purchase the new phone in 24 installments without interest charges.

The South China Morning Post is owned by Alibaba.

The discounts indicate soft demand for Apple’s new phones in China, in the world’s largest smartphone market, which is also one of the most competitive.

The iPhone 16 ships from Sept. 20 but without the company’s new AI service called Apple intelligence, which will launch in the U.S. next month with the first set of features.

The tech giant will launch the AI tool in localized English in several markets in December, while other languages, including Chinese, will not be available until next year. The company has also not indicated how it plans to offer Apple Intelligence in China, where the government has strict oversight over generative AI services accessible by the people, the report noted.

On Monday, it was reported that the iPhone 16 series first-weekend pre-order sales are estimated at about 37 million units, down about 12.7% year-over-year from last year’s iPhone 15 series first-weekend sales.

Apple’s smartphone market share in China has been facing tough competition from Chinese rivals, such as the resurgent Huawei.

Last week, Huawei unveiled its Z-shaped trifold phone Mate XT just a few hours after Apple launched the iPhone 16 models.

Huawei’s smartphone shipments in China had soared 41% year-over-year in the second quarter of 2024, while Apple’s (AAPL) iPhone shipments had dipped by about two percentage points in the same period, according to data from research firm Canalys.