There is a strong reason you should expect an iPhone 8 price cut this holiday season. Let’s admit it. The iPhone 8 and 8 Plus are expensive for the features they offer. The iPhone 8 has a new processor, an old and slow wireless charging technology, and a slightly improved camera. In all other aspects, it is similar to last year’s iPhone 7. Apple is charging you $150 extra for these minor tweaks. The iPhone 8 has a starting price of $699, while the iPhone 7 is now selling for $549.
iPhone 8 price cut likely during holiday season
Few exciting features and anticipation for the hot new iPhone X have led to weak iPhone 8 sales. South China Morning Post says that the iPhone 8 price cut is already rampant in China because the device has “quickly run out of steam” in the world’s largest smartphone market just a month after its release. Major online retailers in the country are offering huge discounts to lure buyers.
Last year, the iPhone 7 and 7 Plus were still hard to find a month after their launch. But the scene is entirely different for the iPhone 8 and 8 Plus. E-commerce players such as Suning.com are offering discounts of up to 1,100 yuan ($165) on the devices. It brings down the iPhone 8 starting price to $721 in China. Of course, it’s still higher than the starting price in the US, but iPhones in China have almost always been priced much higher than in the US.
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The steep iPhone 8 price cut in China hints at declining demand. The demand has been lower than expected in most other countries including the US. So, American buyers who cannot afford to buy the iPhone X may soon be able to purchase the iPhone 8 or iPhone 8 Plus at discounted prices. There haven’t yet been aggressive carrier discounts on the iPhone 8.
ValueWalk reported earlier this month that the iPhone 7 and 7 Plus have been selling better than the iPhone 8 and 8 Plus in the US and the UK. Last year’s models received a price drop following the iPhone 8 launch. Citing Pintu Tank analyst Zhao Ziming, the South China Morning Post noted that the iPhone 8 might be the “most poorly sold flagship iPhone” in China. The country has never seen such huge discounts on an iPhone so soon after launch.
Apple has appropriately responded to the poor demand for the iPhone 8. Supply chain reports indicate that the company has told its suppliers to cut the iPhone 8 production by 50% in November and December. Apple is estimated to ship 5-6 million iPhone 8 units per month in November and December. The tech giant is expected to talk about new smartphone sales during its Nov.3 earnings call.
Older iPhones see strong sales in China
Separately, research firm Canalys claims in its latest report that Apple’s smartphone shipments in China registered an impressive growth in September quarter after six straight quarters of decline. The growth was partially due to the iPhone 8 because Apple lowered the prices of older iPhones after its launch. Consumers were flocking to the older models rather than the iPhone 8.
Canalys estimates the Cupertino company shipped 11 million phones to China in September quarter, up from 8 million in the same period a year earlier. However, Canalys analyst Mo Jia warned that the situation was “only temporary.” Apple might not be able to sustain the same growth in December quarter in the fiercely competitive Chinese market.
Mo Jia added that the iPhone X had generated a lot of excitement in China, but its high price and limited supply would hurt its sales. The iPhone X popularity won’t help Apple in the near term, though the handset would “enjoy a healthy gray market status.” The Chinese market is dominated by Huawei, Oppo, and Vivo, each of which shipped more than 20 million units during the September quarter.
Coming back to the US market, there aren’t many exciting carrier deals on the iPhone 8 or 8 Plus, and the focus has now almost entirely shifted to the iPhone X. Verizon offers up to $300 credit for the iPhone 8 if you trade-in your current phone. The Big Red also has 24-month installment plans starting at $29.16/month for the iPhone 8 and $33.33 per month for the 8 Plus.
AT&T also has a trade-in program. The carrier also offers the 64GB iPhone 8 for 30 installments of $23.34. Sprint and T-Mobile also have trade-in programs. Sprint’s plan can bring down your monthly payments to $9.72 for the iPhone 8 and $13.89 for the 8 Plus. Besides the $300 trade-in offer, T-Mobile also has an iPhone upgrade program. Under the program, you can upgrade to the next iPhone after you have paid off 50% of the iPhone 8 or 88 Plus using its monthly installment plan.