Apple (AAPL)’s “Once you go Mac, you’ll never go back” spell is losing its charm in China, as a growing number of former fans switch from iPhones to domestic brands like Huawei amid escalating tensions between the U.S. and China over trade and technology.
Consumers were spurred by a rising “nationalist sentiment” to support Huawei after the U.S. government threatened to cripple the company by cutting off its supply channels with American companies, reports the Hong Kong-based South China Morning Post.
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“There is a calling from my heart that I need to show support for Chinese brands, especially in the trade war climate,” Wang Zhixin, a manager at a large solar module manufacturer, told the paper. Earlier this month, he retired his three-year-old iPhone 7 and got a Huawei P30.
“It’s kind of embarrassing to pull an iPhone out of your pocket nowadays when all the company executives use Huawei,” said another former Apple fan, Sam Li, who works at a state-owned telecom company in Beijing.
Last week, the U.S. Commerce Department added Huawei, along with 68 of its affiliates, to the department’s “entities list,” a catalog of companies prohibited from buying components from American companies over national security concerns.
Huawei relies heavily on American chipmakers such as Qualcomm and Intel for manufacturing telecom equipment and smartphones. Cutting off U.S. supplies is essentially doomsday for the company’s production line.
Google announced on Monday that it would block Huawei from its Android operating system and services including Gmail, maps and search, which would effectively destroy Huawei’s overseas markets, because no one would want a non-Apple smartphone without a working operating system.
The one-two punch from Washington and Google has sparked an anti-American campaign on Chinese social media, starting with Apple, the most popular American tech brand in China.
China is Apple’s largest overseas market, accounting for 17 percent of its total sales in the most recent quarter. Last year, Apple ranked as China’s fifth most popular smartphone brand with a 9.1 percent market share in the country. But that number has already fallen to seven percent in the first quarter of 2019 as a result of a subsiding demand for Apple products and Chinese consumers’ growing support for domestic brands.
The shift is not just because of political reasons. “[Huawei] has a reputation for better quality at a cheaper price,” said Wang. “[The P30] is faster and can take better pictures.”
Goldman Sachs predicted Wednesday that if Apple’s products were banned in mainland China, its earnings could drop by as much as 29 percent.
