Apple iPhone’s issues in China may be difficult to fix

“The U.S.-China trade conflict hasn’t been kind to Apple investors, but it might be even worse than people thought,” Annie Gaus writes for TheStreet.
“Stanley Chao, a consultant who advises American brands on selling in the Chinese market, said that there’s been growing disfavor among Chinese consumers towards U.S. brands — not just Apple, but other well-known names like Nike and McDonald’s,” Gaus writes. “‘Based on my many trips to China this past year, there has been lots of anti-U.S. sentiment given Trump’s negative comments about China,’ Chao said. ‘The average Chinese consumer is saying, ‘Why should I buy a U.S. product if the U.S. hates us so much? There are so many options out there now — Huawei, Samsung, etc. so I’ll just buy one of those and not support the U.S.””
MacDailyNews Take: Apple product assemblers and component suppliers employ hundreds of thousands of Chinese workers.
“Despite Cook’s long-standing efforts to cultivate a strong relations with Chinese officials and the public, U.S. brands are now synonymous with America according to Chao. ‘Cook and U.S. companies can’t do a thing about it,’ he added,” Gaus writes. ” Speaking to CNBC on Wednesday night, Cook expressed some optimism that trade relations between the U.S. and China will improve, saying he was ‘encouraged’ by recent discussions with both countries. ”
Read more in the full article here.
MacDailyNews Take: As we wrote back in August:
The tariffs are not the end game. They are bargaining chips and, due to the trade imbalance, the U.S. has 376 billion more chips with which to play than China ($506B – $130B)… China’s running out of chips already. This initial negotiation phase too shall pass. The end result will be better than the starting point.
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If you look at our results, our shortfall is over 100% from iPhone and it’s primarily in greater China. And so as we look at what’s going on in China — it’s clear that the economy begins to slow there for the second half. And what I believe to be the case is the trade tensions between the United States and China put additional pressure on their economy… I’ve had obviously many, many discussions [with the Trump administration] over the course of many months to be constructed and to give sort of my perspective on trade and the importance of it to the American economy as well. And I feel like I’m — that I’m being listened to in that respect. And so I’m actually encouraged by what I’ve heard most recently coming from the U.S. and from China and hopefully we’ll see some changes. – Apple CEO Tim Cook, January 2, 2019

The United States is insisting that all countries that have placed artificial Trade Barriers and Tariffs on goods going into their country, remove those Barriers & Tariffs or be met with more than Reciprocity by the U.S.A. Trade must be fair and no longer a one way street!
— Donald J. Trump (@realDonaldTrump) June 24, 2018

I’m cognizant that in both the U.S. and China, there have been cases where everyone hasn’t benefited, where the benefit hasn’t been balanced. My belief is that one plus one equals three. The pie gets larger, working together. — Apple CEO Tim Cook, March 24, 2018
At least half of the popular fallacies about economics come from assuming that economic activity is a zero-sum game, in which what is gained by someone is lost by someone else. But transactions would not continue unless both sides gained, whether in international trade, employment, or renting an apartment. — Thomas Sowell, June 14, 2006
SEE ALSO:
Advisor to President Trump: Apple’s sales should pick up when U.S.-China strike trade deal – January 3, 2019