Apple CEO Tim Cook reiterated the company’s commitment to China in a meeting with the country’s Minister of Industry and Information Technology, Jin Zhuanglong, during his second visit to China this year.
In a Ministry post to the Chinese messaging app WeChat, it said that Apple would “continue to grow its investments in China and help the high-quality development of the supply chain”. The IT Minister also urged Cook to continue to invest in China to drive innovation and collaborate with Chinese companies to share the rewards of development.
The trip comes as Apple’s iPhone sales in the country have staggered and domestic competition has gained market share. The US company has also faced hurdles from the Chinese Government and regulators.
AI features developed with OpenAI that are set to arrive for some of the latest iPhone models will not be available in China until next year. Cook told the local news outlet Jiemian that Apple needs to complete a thorough regulatory process first. OpenAI has curbed access to ChatGPT in China before. The country has highly demanding rules and limits for AI products, which must reflect “the core values of socialism” and avoid “undermin[ing] national unity”.
Some consumers have been reluctant to purchase the new iPhone 16 given they won’t have access to the AI system available in other territories.
Falling sales
Despite this reluctance, sales shot up 20% in the first three weeks when the iPhone 16 was put on sale. It was a welcome development for Apple, which has been experiencing a trend of falling sales in China in the face of government curbs and stronger domestic competition. According to Counterpoint Research, overall iPhone unit sales in China still dropped 2% year on year during the same period because of a lack of interest in older models.
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In September 2023, the Chinese Government ordered staff to stop bringing foreign devices into work, including iPhones.
Cook’s visit also comes as the US leads a global push to decouple the West from China, particularly where it concerns technology. The US is currently reviewing rules that would target outbound investments to China in the AI, semiconductors, microelectronics and quantum computing sectors.
Apple has received criticism from US legislators in the past for its relationship with China. In 2019, unlikely allies Republican Senator Ted Cruz, Democratic Representative Alexandria Ocasio-Cortez and other bipartisan legislators called out the company for the “censorship of apps” at the “behest of the Chinese government” at the height of the pro-democracy protests in Hong Kong.
