Certainly, the iPhone remains the highest priced smartphone in China. There is a possibility, however, for the price to spike even higher due to the rapidly devaluing Chinese currency.
The importance of the yuan's value to the new iPhone's revenue can be attributed to the fact that Apple pays its suppliers in dollars. In a rough calculation, Apple is poised to lose a few hundred million in revenue for the Chinese market, said the Wall Street Journal.
A year ago, the iPhone 6 cost 5288 yuan, which is equivalent to $861 U.S. Today, however, the value is only $829 - a $32 difference for every iPhone, according to the report. Taking average currency fluctuations into consideration and the performance of iPhone sales in China, it was revealed that Apple will face a $210 million revenue loss, which accounts for about 1 percent of the Greater China sales.
The impact of the yuan's devaluation on Apple's sales in China has already been reported in August. For instance, Arthur Liao has pointed out that the company may be forced to raise prices if the yuan continues to plummet, in an Apple Insider report. Apple has already indicated previously that it could, indeed, raise pricing on account of currency devaluation.
"There is a risk that the company will have to adjust local currency product pricing due to competitive pressures when there have been significant volatility in foreign currency exchange rates," Apple said in an International Business Times report.
Presently, the announced price tag for the iPhone 6S is still the same as the previous iPhone 6 in China. But Apple is yet to address the pricing issue amid the continuing yuan devaluation. The price hike is not too far-fetched as the company did the very same thing in Russia after the rouble collapsed, CNET reported.
