ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintSite TitleTitle ChevronIcon Twitter
Business trends

Apple loses top slot of India's premium smartphone market to Samsung

iPhone maker's market share slumps after duties boosted prices

MUMBAI (NewsRise) -- Apple slipped from the top of India's high-end smartphone market in January-March as the iPhone maker lost ground to South Korea's Samsung Electronics and China's OnePlus amid a surge in tariffs on imported handsets.

Apple's market share in the premium price segment above 30,000 rupees ($452) stood at 18% in the quarter, compared with 45% in the year-earlier period, Hong Kong-based Counterpoint Research said Friday. Samsung vaulted past second-ranked OnePlus and dethroned Apple to lead the market with a 50% share. OnePlus held ground with a 25% share, Counterpoint said.

Apple's sales in India have been marred by the rising tariffs on its assembled phones after New Delhi raised custom duty on imported mobile phones twice between December and February to 20% from 10% to encourage local production.

"Apple is likely to continue facing trouble in India in the near to mid-term, until it has a relatively cheaper product," said Neil Shah, research director at Counterpoint.

Apple's priciest iPhone X model costs 108,930 rupees for a 256 gigabytes variant, according to its website. In contrast, Samsung's latest S9 Plus model costs 72,900 rupees, the South Korean company's website shows.

Apple has been struggling to expand its share in the price-sensitive Indian market -- the largest in the world after China -- where it held a tiny portion of the overall shipment. In the quarter ended in March, Apple held a less than 2% share, in contrast to market leader Xiaomi's 31% share and Samsung's 26%.

The Cupertino, California-based company has been negotiating with the Indian government for duty-free import of components for a very long time in a bid to bring down prices. Last year, Apple started selling its first domestically assembled iPhone SEs in India, where it tied up with Taiwanese contract manufacturer Wistron.

The south Asian country is critical for iPhone maker's growth in the next few years as it grapples with slowing sales in developed markets.

But in a major setback for Apple, in March India imposed a 10% customs duty on parts and equipment of mobile phones such as motherboards, camera modules, and connectors to further boost local manufacturing.

In the quarter ended in March, Apple saw its sales decline 55% amid a surge in the price of iPhones by as much as 8%, and decline in shipment of iPhone X and 8, Counterpoint's Shah said.

Apple will have to partner with a local manufacturing company to bring down the price of its devices, Shah said.

"It will have to introduce devices in the 50,000 rupees to 60,000 rupees range to lure Indian customers."

Samsung, on the other hand, saw its market share expand on the back new models such as S9, S9 Plus, and A8 Plus. Samsung ducked the impact of new duty thanks to its local plants which have been manufacturing cell phones for domestic consumption as well as for exports for almost a decade.

Sales of smartphones have been surging in India due to the availability of high-speed internet services at inexpensive tariffs. In 2016, Reliance Jio Infocomm, billionaire Mukesh Ambani's wireless venture, offered high-speed internet services free for months, triggering a price war among mobile phone operators and drastically bringing down data prices.

--Dhanya Ann Thoppil

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends April 30th

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media