Apple suffered a "Waterloo" in India: less than 1 million mobile phone sales in the first half of 2018, with a market share of only 2%

According to Bloomberg, iPhone sales in India were less than 1 million units in the first half of 2018.

Leifeng.com Note: Apple store in New Delhi, India

Apple has a market share of just 2% in India, according to Counterpoint Research, and sold just 3.2 million iPhones in 2017. In the first half of 2018, fewer than 1 million iPhones were sold in India. Even with a big jump in sales in the second half of the year, total sales are expected to be lower than last year.

Bloomberg reported that three key executives of Apple in India have left in recent weeks, including the company's national sales and distribution head, the head of commercial channels and mid-market business, and the head of telecom operator sales. A person familiar with the matter said that Apple's sales team in India is undergoing a restructuring because the company is struggling to increase iPhone sales in India, the world's fastest-growing smartphone market.

Apple's inability to grow its business and single-digit market share stand in stark contrast to CEO Tim Cook's publicly optimistic statements.

Leifeng.com Note: Cook meets with Indian Prime Minister Modi

Cook has hinted that India could be the next China and has said it will aggressively enter the Indian market. While the price of the iPhone is out of reach for most people, he predicts that young, aspiring Indians will rise in socioeconomic status. In May, he said on a call with investors that Apple's revenue in India had grown, setting a record for the first half of 2018.

India is the world's third-largest smartphone market, but its high tariffs, which have increased prices by 15% to 20%, have prompted consumers to turn to cheaper alternatives such as Samsung and Xiaomi.

According to IDC data, India's smartphone market shipped 30 million units in the first quarter of 2018, a strong start and maintained a healthy annual growth rate of 11%.

As can be seen from the above figure, as of the first quarter of 2018, the top five companies in India's smartphone market share, except Samsung, are all from China, accounting for a total of 49% of the market share. It can be said that Chinese manufacturers have occupied half of the Indian smartphone market.

According to IDC statistics, Xiaomi became the country's largest smartphone brand in terms of shipments three and a half years after officially entering the Indian market, with a market share of 26.8% in the fourth quarter of 2017. In the first quarter of 2018, Xiaomi still ranked first in smartphone shipments in India, with a market share of 30.3%.

In this list, the iPhone, which only accounts for 2% of the market share, is nowhere to be found. The "Waterloo" that Apple suffered in India can be said to be particularly tragic.

As for the reason why Apple failed in India, Bloomberg analyzed that the Indian market is currently in a low purchasing power stage, and most consumers can only afford the cost of cheap mobile phones. Due to its high price, the iPhone can only be consumed by a small number of people. The Times of India published an article in February 2017 stating that the price of Apple's new smartphones is more than 50,000 rupees (about 5,000 yuan), while 70% to 80% of mobile phones in the Indian market are priced below 10,000 rupees (about 1,000 yuan).

The Indian government's push for local production of high-end electronic products and the resulting tariff increases have put most mobile phone manufacturers under further profit pressure.

However, IDC predicts that the Indian smartphone market will continue to maintain double-digit growth in 2018. The popularity of smartphones and the focus will be on cheap phones. Leading manufacturers are actively expanding offline and are also continuing to make efforts on online platforms.

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