Apple has long regarded India as its next major growth market for smartphones. But the news from India lately has been grim as Apple's share of the market steadily shrinks. Strategy Analytics’  India Smartphone Market Vendor Share report records a stark fall in shipment volumes and marketshare for Apple in India, particularly in 2018 when volumes fell by more than 3X and share more than halved in recent quarters.

Apple has looked to make itself a fixture in the India market by manufacturing iPhones in the country. India is the world’s fastest growing location for the manufacturing of smartphones, as illustrated in the report Global Handset Manufacturing by Country, with volumes increasing by 35% annually in 2018; the report also makes clear that Indian handset manufacturing growth is coming at the expense of China, which saw annual volumes shrink marginally this year.

Apple, via its Contract Equipment Manufacturer (CEM) Foxconn, has assembled the iPhone SE, and from 2018 the iPhone 6S, in India. New reports indicate that the company will begin to manufacture its higher end iPhones in India beginning in Q1 2019.

The move reflects both the reality that only by manufacturing in India can smartphone vendors like Apple avoid high tariffs imposed by the Indian government on phone imports, and the fact that it needs to introduce new models if it is to reignite demand for its smartphones in India. That strategy though will run into the reality that Apple’s higher-end iPhones are among the most expensive smartphones in the world, while India currently ranks in 86^th place out of 88 countries in terms of smartphone ASP in 2018 and will only improve to 84^th place by 2023.

To succeed in India, Apple will need to change its pricing strategies to reflect what Indian consumers want and can afford. Strategy Analytics recommends that Apple consider making India-only iPhone models that are unique from its offerings in the rest of the world and sufficiently differentiated to position it to better compete with Android offerings from Samsung, Xiaomi and a host of other smartphone vendors. If Apple chooses not to adopt this strategy, it will have to accept that its share in this rapidly growing market will continue to wither.

Strategy Analytics offers a number of highly detailed reports that examine smartphone vendor strategies, technologies, smartphone models, share and revenue across multiple countries and regions covering the entire globe. Clients can access these reports in the following services:

Device Technologies
Handset Country Share Tracker
Smartphone Model Tracker
Wireless Smartphone Strategies