September 19, 2021

Apple’s reputation plummets in China due to Washington’s trade war with Beijing


Apple’s reputation has tumbled in China because of a trade war between Washington and Beijing, according to a new survey.

The US technology giant’s popularity in the Far East slipped 19 places in the space of two years as the tariff battle between the world’s two largest economies escalated.  

Chinese consumers have shown growing loyalty to Huawei – one of Apple’s main competitors – because they see the trade sanctions imposed on the Chinese telecom company as ‘an attack’ from the US, analysts say. 

Apple’s brand reputation in China has taken a hit due to the trade war while Huawei’s popularity has grown, a new survey finds. The US tech firm is only the 24th most popular brand for Chinese consumers compared to the fifth in 2017 before the tit-for-tat tariff battle began

Experts say Apple has taken the ‘great fall of China’ because ‘it is a distinctly American brand’

The findings were revealed yesterday in a report from marketing consultancy Prophet after it surveyed 13,500 Chinese customers about 258 brands. 

Apple’s was the fifth most popular brand in China in 2017 before the US-China trade war began. 

Its influenced dropped to the 11th last year at the beginning of the tit-for-tat tariff battle, and then to the 24th this year in the midst of it, according to the San Francisco-headquartered firm.

In comparison, Huawei’s reputation increased from the fourth in 2018 to the second this year, only after Chinese mobile payment company Alipay which has dominated the list for four years consecutively. 

Commenting on the results, a Huawei spokesperson said: ‘We’re delighted this new research shows consumers love our smartphones, wearables, laptops and tablet computers.’ 

US President Trump and Chinese President Xi have traded blows in the economic dispute which has gone on for over a year. The two leaders are pictured at a meeting in Beijing in 2017

China and the United States have already imposed tariffs on hundreds of billions of dollars of each other’s goods in the trade war, though trade talks are set to resume next month 

Washington accuses Huawei of spying on its users for Beijing – allegations the Shenzhen-based telecom company and Beijing have repeatedly denied. 

The 10 most popular brands in China 

1. Alipay

2. Huawei

3. Android

4. DJI drones

5. WeChat

6. Bilibili video website

7. Xiaomi

8. China Citic Bank

9. Intel

10. Audi 

Last December, Huawei’s CFO Meng Wanzhou was arrested in Canada under the request of the United States for allegedly violating Iran sanctions and lying about it to American banks – accusations her lawyers dispute.

US President Donald Trump in May issued orders to ban Huawei from using US technology, components and suppliers out of concerns over national security. The sanction has since been delayed twice – each time for 90 days. 

Google then cut ties with Huawei, blocking it from using Android system on its smartphones. 

Washington has also urged its allies to ban Huawei from their 5G networks, or they might be blocked from sharing intelligence with the White House.

The series of action have enraged China and its people, many of whom called for a boycott against American products.  

Ms Meng, Huawei’s CFO and heiress-apparent, is facing extradition to the U.S. over alleged violations of American sanctions against Iran. Her extradition hearings are set to be next January, more than a year after she was arrested during her trip from Hong Kong to Mexico

Huawei was founded by self-made billionaire Ren Zhengfei (pictured) who served in military 

‘There’s a lot of nationalistic buying in that category because Chinese consumers interpreted what happened to Huawei as an attack,’ said Jay Milliken, a Hong Kong-based senior partner from Prophet.

There are two American brands in this year’s ranking: Android which ranked the third and Intel which ranked the ninth. 

Chinese shoppers were becoming more patriotic in the brands they use or wish to buy, Mr Milliken told Bloomberg.  

Even the news about Apple’s declining reputation is celebrated by some on Weibo, the Chinese equivalent to Twitter.

A trending topic page has been set up and it has so far attracted more than 120 million views.

One user wrote: ‘Rise, Chinese products! Of course I support Chinese products.’

Another one said: ‘Apple makes no attempts to make progress, Huawei has breakthrough achievements constantly, which one do you think I would choose?’

Huawei’s handsets are now considered more ‘salient and trusted’ than Apple’s iPhone in China, according to Martin Guerrieria, Kantar’s Global BrandZ research director.

Mr Guerrieria told MailOnline that the two brands’ enjoyed nearly equal brand influence in the country because of a ‘meteoric rise’ of Huawei and a clear dip for iPhone. 

Experts say there is little Apple can do to salvage its shrunken market or restore its following in China and firms that do business in both markets face the risk of getting pulled into the row

‘The long-term goal of the Chinese government is to establish national champions. Huawei is a prime example of this,’ Stefan Legge, a trade expert, told MailOnline. Chinese shoppers are seen looking at products at a Huawei store in Hangzhou, China, on August 16

As China and the United States are still tussling in trade talks, experts say there is little Apple can do to salvage its shrunken market or restore its following in China, and companies that do business in both markets face the risk of getting pulled into the conflict.

Stefan Legge, a trade expert at the University of St. Gallen in Switzerland, said Apple had taken a hit in the trade war because ‘it is a distinctly American brand’ to the Chinese buyers.

‘The long-term goal of the Chinese government is to establish national champions. Huawei is a prime example of this,’ Mr Legge told MailOnline.

‘While China wanted to be attractive to foreign companies to foster the country’s development in the past, the focus has shifted.’

He added: ‘If Huawei is indeed selected and backed by the Chinese government, Apple’s best days in China might well be in the past.’  

The Chinese market accounted for nearly 18 per cent of Apple’s global sales revenue in its fiscal third-quarter this year, which ended at the end of June.  

Richard Yu, Huawei’s CEO, holds the new Huawei Mate 30 Pro smartphone during it’s presentation today in Munich, Germany. The phone comes without popular Google apps

China views the trade sanctions against Huawei as a ‘disgraceful and immoral crackdown’ from the United States on Chinese companies.

Beijing is in the process of drafting its own ‘entity list’ to punish foreign companies that harm the interests of its businesses. 

The Chinese Ministry of Foreign Affairs said this week that the world should be wary of Apple because it had assisted Washington to spy on ordinary users as well as country leaders ‘for as long as 10 years’. 

Speaking at a press conference on Monday, Hua Chunying, a spokesperson from the Ministry, also accused American IT provider Cisco of secretly collecting information from its users through the firm’s devices. 

She urged the two American firms to provide explanation on the matter. 

Read More

Daily Mail

Filed Under: Essentials