Roger Fingas
Gray market iPhone X dealers in Beijing are reportedly charging much smaller premiums for the iPhone X than they did for last year's iPhone 7 Plus, allegedly reflecting lower Chinese demand in general.
Resellers were charging up to 29 percent for the 256-gigabyte iPhone X at last week's launch, versus 163 percent for the jet black version of the iPhone 7 Plus in 2016, according to JL Warren Capital research cited by Bloomberg. At a city electronics market, the X markup was just 15 percent.
The main issue is believed to be price. Before any markup, a 64-gigabyte iPhone X is 8,388 yuan in China, or about $1,264. Choosing 256 gigabytes ramps the cost up to 9,688 yuan, or $1,459. The phone can easily cost as much or more than someone's monthly salary.
Premiums are liable to shrink even further in coming months as Apple's supply begins to catch up to demand, eventually making it pointless for a shopper to turn to the gray market to beat shipping delays. In the U.S., online orders are currently shipping in three to four weeks.
Another compounding factor is the availability of comparable but cheaper Android phones from domestic firms like Huawei and Oppo. Apple remains in fifth in the Chinese smartphone market, despite a boost from September's launch of the iPhone 8 and 8 Plus.
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22 Comments
I still don't get the people that line up to pay a surcharge just to get a cell phone a few days or weeks early. Makes no sense at all to me. It makes about a s much sense as people crowding a chain restaurant the first few weeks after it opens, even though it serves the same food as the rest of the restaurants in the chain. What is the point?
OR how easy it is now to get an iPhone via official channels.
Yeah, check back in 2-3 months for the true story.
This is like the several stories about how the iPhone 6 or so was unpopular in Japan (it hit record sales there), then in China (again), more recently about how the iPhone 8 wasn't selling well (Apple's quarterly results show it broke last years 7 sales and exceeded guidance) and so on.
There's no way the X is going to sell bad in China. It has something Chinese buyers of premium phones look for specifically: it's distinct enough to signal you got the new model.
Wouldn’t this support Apple’s claim that they have enough supply?
It could be softer demand, but it could also be a reflection of better supply - which seems to be the case in parts of the USA where many stores still accepted walk-ins many days after launch (some still do today), despite 'off the charts' sales.
A higher price and better supply makes grey market phones a risky business. A single unsold phone could easily wipe out profits from the sale of 4+ other grey market iPhone X's, which means grey market margins need to be optimised to take advantage of a short-lived scarcity. (And as mentioned by the author, the higher grey market price may persuade many buyers to wait for an iPhone from an official channel, decreasing grey market demand -and prices- as a whole.)