Not long ago, gray market dealers in China had it made – with the iPhone 6 and iPhone 6 Plus release date delayed in the country, that gave these dealers the impetus to jack up prices big-time. Customers also seemed interested in these smuggled devices, never mind that they often cost several times more than the actual MSRP. However, it now appears that demand for these “hot” iPhones has waned, as indicated by a special report from the New York Times.
Prior to the report, iPhone 6 and iPhone 6 Plus variants were selling in China for as much as $2,500. However, the Times reported that one dealer had to reduce prices from $1,960 to $2,450 to $1,060 to $1,436, a discount of close to 50 percent. Several thousand iPhone 6 and 6 Plus units were smuggled into China from different locations, including New York City, and since gray market trading on these devices began, dealers were estimated to be making as much as $163 per handset, a tidy profit indeed. Unfortunately for them, the combination of diminished demand and an increased number of gray market dealers may spell trouble in the long run.
There are other variables that may further dampen things for the so-called gray market, aside from increased competition and reduced demand. For one, China now has several local manufacturers selling products that cost much less than the iPhone 6 and iPhone 6 Plus, but can hold their own in terms of technical specs. This is in stark contrast to previous iPhone releases, where the iPhone was the must-own handset for Chinese buyers, especially with release dates far removed from that of the U.S. Also, the Chinese government has been less than subtle in slagging American-made products and pushing their local counterparts.
Apple has yet to announce an official iPhone 6/6 Plus release date in China, but with regulatory issues slowly getting ironed out, it shouldn’t be long before the devices become legally available for Chinese consumers to purchase.