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Apple’s new iPhone 11 is experiencing a strong showing and could be the next big thing for Apple in China. The company is expected to absorb the US-China trade tariffs to keep business up and customers as well.
It seems that this year will be a boom period for Apple Inc. as both high end and low-end spectrums of its phones are having a great reception albeit in two different continents and markets. Feelers coming in from Apples’ preorders in China indicate that the iPhone 11 might just become just the device that Apple needs to drive sales this year. The Chinese market has already chosen the iPhone 11 as the most popular Apple product this year.
Natural Attraction or Business Gimmick?
Usually, the Chinese market has to pay a premium on all iPhones sold within China. However, the California tech giant had to cut such premiums down. That may have spurred the interest of those who just had to buy an iPhone but couldn’t afford to do so previously.
Chinese customers still have to pay between 10.5% and 12.5% which is around 5,499 Yuan ($777). This, of course, is cheaper than last years’ iPhone XR which still had a hefty premium of 28%. These premiums come amidst criticism that prices are way too high because most of the manufacturing activities of the iPhones occur in China.
According to CNBC, major e-commerce retailer Fenquile reports that 40% ordered the 128 GB iPhone 11 while 20% ordered the 64GB version indicating the massive demand for it.
A Sudden Reversal of Fortunes
Come December, the US markets for the iPhone and other high-end products are going to face issues. These issues will come from the tariffs that are as a result of the fallout of the US-China trade war. How these tariffs will affect iPhone prices in the US remains yet to be seen.
While the Chinese are already implementing 5g technologies and Apple is yet to catch up. This, of course, gives no indication that the innovators won’t be able to introduce a 5G phone next year which is what exactly they are already planning.
Notable research analyst for TF Securities, Ming Chi-Kuo believes that both the iPhone 11 and iPhone 11 pro’s sales will reach 75 million units this year. He gave his views in a research note that Apple Insider had ad access to, revising his estimations upwards to 70 to 75 million units from 65 to 70 million units previously.
He further gave indications as to the preferences of the American market for the iPhone 11 pro and the cheaper iPhone 11 for the Chinese. He identified the various flexible payment options for the Americans and the reduction of market premiums for the Chinese which will spur demand upwards.
He further expected the Chinese to take the practical choice of using the iPhone 11 as a suitable upgrade rather than the iPhone 11 pro due to higher prices. As for the trade war tariffs which will come into effect on December 15th, he didn’t expect Apple to increase the prices of its products but rather the absorption of the tariffs will be a likely scenario.
This goes in tandem with the technology giant’s decision to keep prices of its watch phones the same earlier this year.
The iPhone 11 vs. iPhone 11 Pro
Apple seems to have made things interesting for its fans this time with slight differences between the iPhone 11 and iPhone 11 pro. The iPhone 11 is a little slower than the iPhone 11 pro due to differences in the CPU and GPU. The iPhone 11 has a 6. Inch liquid retina display while the iPhone 11 pro has a super retina display with a 2 million to 1 contrast OLED.
In terms of GPU, the iPhone 11 has an A13 Bionic chip with a neural engine while the iPhone 11 pro has an A13 7nm bionic chip which is sensitive to battery use and only takes what it needs from the battery as per tasks executed.
Whichever of the versions you choose, you can be sure of a great piece of engineering which Apple is always known for globally.
At the time of writing, AAPL stock is down by 0,69% making $217.25 per share.