Apple iPhone Sales Falter in India

Apple, with a premium-priced iPhone, is facing tough competition from local smartphone manufacturers

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Apple is having a tough time gaining ground in India, as the country has seen healthy growth in the smartphone market over the years. According to Strategy Analytics, a market research firm, the company saw a 35% drop in iPhone sales during the second quarter of this year.

The iPhone maker sold approximately 800,000 units in the second quarter, compared to 1.2 million units during the second quarter last year. Having failed to pull Indian users toward its cheapest smartphone, iPhone SE, Apple is also facing issues selling its refurbished smartphones in the market. The company should expand its retail presence by opening more Apple stores in India, according to Strategy Analytics.

Similarly, another research firm, Gartner, believes as many as 139 million smartphones will be shipped to India this year. However, most of them will run Android and cost less than $150. According to the data revealed by Strategy Analytics, Android has captured a 97% market share in the Indian smartphone market.

Apple CEO Tim Cook said during his tour of India: “It’s difficult for an operator here to sell a product themselves because of the tax structure,” told local TV channel, NDTV. He added: “In India, carriers sell virtually no phones and it is out in retail — and retail is many, many different small shops.”

All this does not suggest that Apple has no demand in India. In May, a report published by Canalys indicated that the iPhone maker had posed a serious threat to Samsung in the premium sector. During the first quarter of this year, Apple’s market share increased from 11% to 29%, while Samsung saw a decline from 66% to 41%.

The company has also been trying to negotiate with local regulatory bodies on sourcing rules for quite some time. A report from The Economic Times of India claims that Apple’s assembly partner, Foxonn, is planning to build a $10 billion manufacturing plant to cater to the company’s needs. However, a deal has not been signed yet and could take more than a year for operations to commence.

The launch of iPhone 7 is just around the corner and rumor is it will be launched both in India and the rest of the world simultaneously. Therefore, users in India might not have to wait long enough to get their hands on iPhone 7.