On Wednesday, Apple introduced the iPhone 16e. This new phone replaces both the iPhone SE and iPhone 14 in their lineup. It’s the most affordable option in the iPhone 16 series, targeting emerging markets like India.
India, the second largest smartphone market, has seen a rise in iPhone sales. Apple recently entered the top five smartphone vendors in the country. However, it’s still uncertain how the iPhone 16e will affect this important market.
By 2024, India became Apple’s fourth largest market after the U.S., China, and Japan. The country recorded over 12 million iPhone shipments in one quarter, marking a 35% year-over-year growth, according to IDC. This year, shipments are expected to exceed 15 million.
Surprisingly, it wasn’t the iPhone SE or iPhone 14 that drove this growth in India. The iPhone 15 and iPhone 13 led sales, holding a 6% share of the overall smartphone market in Q4.
Despite Apple’s Indian success, the iPhone SE has seen a decrease in shipments. Initially, the iPhone SE (2020) accounted for 18% of iPhone sales, but that dropped to 6% for the iPhone SE (2022), according to IDC data shared with TechCrunch. In contrast, the iPhone 13 represented nearly 40% of iPhone shipments in 2022.
IDC also reported that shipments of the iPhone SE, both in India and worldwide, fell to very low numbers in 2023 and 2024, with no new SE being released during those years.
Navkendar Singh from IDC India says that about two-thirds of iPhone sales in India come from older model phones.
Android is the leading platform in India’s smartphone market, with an average smartphone price of $259. Chinese brands like Vivo and Xiaomi are competing fiercely. Still, Apple claims the top spot in the $600+ price range, followed by Samsung. This means the biggest competition for iPhones comes from other iPhones.
The iPhone 16e costs 59,900 Indian rupees (around $689), while the older iPhone 15 starts at $804 and the iPhone 16 at $919.
In a price-sensitive market like India, the difference in cost may not be enough for buyers to choose the iPhone 16e over the iPhone 15 since the latter offers better features.
The new features on the 16e may not be enticing enough to lure buyers, especially since many use installment plans to purchase premium phones. About half of those buying phones priced between $400 and $700 in India use these financing options.
“With EMI plans, the actual cost difference may lead many to prefer the iPhone 15 or 16 over the iPhone 16e,” Singh mentioned.
With the iPhone 16e, Apple is aiming at a more budget-friendly segment. This could help increase its service revenue over time, although this initiative is still in the early stages in the U.S. and won’t reach India until April.
The iPhone 16e is also assembled in India, along with other iPhone 16 models. However, this local assembly likely won’t change the price in the short term.
Analyst Sanyam Chaurasia suggests that the iPhone 16e might attract buyers who would otherwise consider the iPhone 12 or 13, which are still available in India. He believes younger consumers might also choose the 16e over the older 15 model. “It’s designed for a niche market,” Chaurasia pointed out.
India is different from places like Latin America or Southeast Asia because it doesn’t have carriers that heavily subsidize smartphones. This makes the iPhone 16e a pricey option for many buyers in India.
Additionally, launching the iPhone 16e now may not be ideal, as major upgrades usually happen during Indian festivals later in the year, noted Chaurasia.
“Apple may need to offer discounts on the iPhone 16e during the festive season, but existing models are likely to be discounted as well, making them more attractive than the new model,” he added.
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