Apple’s products have always been so expensive that in a country like India with a massive middle class population, the price of the latest iPhone starts at Rs. 60,000 (approx $970), which is higher than the monthly income of most individuals. However, since India is the country with the second largest population in the world, it’s not a market any company would want to lose. Hence, Apple decided to sell old-gen iPhones at low prices.

The Indian smartphone market is dominated by less-expensive Android smartphones from Chinese companies like Gionee, Xiaomi, Oppo, and local manufacturer Micromax. These rivals offer features comparable to those on the iPhone but at drastically lower rates.

Apple accounted for just 3% of smartphone sales in the first quarter, and to up its sales further, the U.S. firm is offering old models at lower prices.  Old-gen iPhones made up almost 55% of Apple’s total sales in India last year.

Local resellers and online retailers such as Amazon and Flipkart are selling retro models at highly concessional prices, attracting a good number of buyers in the process. For example, the iPhone 5s is available for Rs. 20,400 or $300 in India, while in the U.S., the iPhone SE costs $400 plus taxes.

Apple is also building an online presence in Indiaby setting up an online store. The good thing for Apple with setting up an online store is that Indian law does not require an FDI or Foreign Direct Investment approval in retail, and companies can directly sell locally-manufactured models online.

Last month, one industry official told ET, “Apple will initially start its online store by selling iPhone SE which will be manufactured in India and will be in line with government policies. The company is hopeful to start the online store in India around Diwali.”

Apart from selling old-gen models, the U.S. firm also plans to set up retail stores in the country.

Another factor that could help push sales in the country is manufacturing locally. Manufacturing iPhones in India would allow them to sell for at least $100 less than they do now. Negotiations between the iPhone maker and the government regarding the next level of production in India are still ongoing, and there are good chances that along with the iPhone SE, the company could assemble iPhone 6 and 6S models in India as well.

Source: valuewalk