The Chinese government agencies and state-backed firms are intensifying their ban on iPhones and foreign devices among their staff, Bloomberg reported. The move underscores China’s determination to reduce its reliance on American technology and has raised concerns about the future of iPhone maker Apple Inc. and South Korean tech major Samsung Electronics Co. in the world’s largest mobile market.
Several government departments and state firms across at least eight provinces, including the prosperous coastal regions, have reportedly recently issued directives requiring their employees to use local smartphone brands instead of iPhones and foreign devices. This significant expansion of the ban comes after a smaller-scale implementation in Beijing and Tianjin last September.
While China has gradually shifted towards using domestic software and hardware, this new directive poses a direct threat to Apple’s market share. Smaller firms and agencies in lower-tier cities have also joined the movement, with orders originating from various provinces, including the populous Henan, home to the world’s largest iPhone factory.
This collective effort poses a significant challenge for both Apple and Samsung, both of which are grappling with stagnant growth in the Chinese market. For Apple, which relies heavily on China for production and generates about a fifth of its revenue from the country, this development is especially worrisome.
While the iPhone 15’s performance in China has been lackluster compared to its predecessor, a significant part of this slowdown can be attributed to the August release of a Huawei smartphone featuring an advanced made-in-China processor. State media celebrated this as a victory against US sanctions, prompting calls from American lawmakers for an investigation.
Meanwhile, the impact of these bans is already visible in the financial markets, with Apple’s stock dipping slightly after Bloomberg reported on the widening prohibitions. Apple suppliers, including LG Innotek Co. and Minebea Mitsumi Inc., also experienced a decline in their stock prices during Asian trading.
Apple has remained tight-lipped about the situation but on the side has started investing and expanding its production facilities in countries like India. Major Apple supplier such as Foxconn and Wistron have, in the recent times, invested heavily in the southern part of the country, while the tech major this year inaugurated two exclusive stores in India.
