Apple is slashing the price on its cheapest iPhone model, the XR, in Japan in an effort to boost sales.
Citing sources “with direct knowledge of the plan,” the Wall Street Journal reported that the country’s major mobile carriers will cut prices on the iPhone XR as early as next week. The XR currently costs 84,800 yen (around $750) on the Japanese Apple Store.
Officials at Japanese carriers noted that it is rare for Apple to cut the price in their market on a just-released smartphone model.
“A price cut within a month of the release is rare — not just for Apple, but for smartphone makers in general,” said a senior official at a wireless operator.
In fact, just last week it was confirmed that Apple had officially cut production orders for all three iPhone models announced in September. The issue seems to be lower than expected demand for the new generations of iPhones combined with three different models all hitting the market at once, making it difficult to predict the number of components and handsets that will be necessary to satisfy consumer demand. The reported production cut follows an earnings report that saw Apple disappoint its investors and offer up a lower than expected sales forecast for Q4, generally its strongest sales period of the year. That forecast led some to speculate on the possibility of weaker than expected iPhone sales.
And iPhone XR seems to be the model with the biggest struggle, with Apple cutting its production by as much as a third of the nearly 70 million units some suppliers had been asked to produce between September and February. Some Japanese consumers have even complained that the XR’s price is too high considering the lack of display quality, number of camera lenses, and slower data-transmission speed.
In the meantime, the WSJ also revealed that the company has started producing the iPhone X again to fulfill its obligation to buy a certain number of organic light-emitting diode (OLED) screens from Samsung. Since the X is cheaper to produce than the XS and XS Max, Apple resumed production to meet the requirement.