A few comments on this from an Indian perspective. Apple products are quite expensive here too, when compared against U.S. prices (plus sales tax). It may seem as if this is because of customs duties, but that’s not the entire story.<p>Many companies tend to have geographically differentiated pricing to expand their market and make more money. Even if the prices aren’t completely matching the local currency equivalent (with respect to USD) and local conditions, they would have some compensation applied.<p>Apple has historically been against differentiated pricing, especially for its hardware. It also focuses heavily on retaining its 35% (approx.) profit margins. Only on a few services has Apple reduced pricing in the recent years in some countries (for example, in India, Apple Arcade, Apple TV+ and Apple Music are priced at nearly one fourth of the U.S. prices, but iCloud is priced the same as in the U.S.).<p>I’m not saying that all Apple hardware products are sold at the USD price plus local customs duties and taxes in other regions, but almost all of them are. <i>What’s more ridiculous is that the prices don’t go down much even when Apple is assembling products locally and doesn’t have to pay as much in duties (a few iPhone models are assembled in India).</i><p>Since Apple has this business model, people in India who do know of someone coming from the U.S. or Dubai or another country/location where these are cheaper ask them to purchase those there and bring them down. There are several <i>“Bring me this from there (BMTFT)”</i> groups on social media to connect people.<p>For individual travelers the duty free limit (legal) plus duty evasion (not legal) in certain cases offer big incentives not to buy locally. I’m sure there’s plenty of organized smuggling also going on.<p><i>Whatever metrics Apple is tracking on sales by country get skewed by this, tilting heavily towards U.S. and other countries and making them seem larger than they are, while also making the countries with typically weaker currencies and higher duties seem as smaller markets than they are.</i> (I know Apple can get country wise usage numbers from its telemetry in iOS, the App Store and other Apple apps)
Even before I clicked the link, I was sure the answer was Brazil. It's not so much the taxes that raise the prices as the tariffs (which are kind of invisible taxes in that they are paid through higher prices rather than directly—which is part of what made a former president's boasting about raising tariffs somewhat absurd. It seemed he believed that the exporting country paid the price of the tariffs and not domestic consumers in the form of higher prices). I remember that there were plans to build a Foxconn factory in Brazil specifically to manufacture iPhones for the Brazilian market because of the tariffs (I don't know if this ever happened, I think maybe it did?).
There is one other important factor that is seldom discussed: inequality. Even being so expensive, they still sell enough to make good profits, because there is enough rich people in Brazil to buy them once a year. Brazil has one of the higher inequalities in the world and while it’s common to say Brazil is poor, the truth is that there is a shitload of very rich people too (it’s more than 200M people after all). I’m sure things would change if people simply stopped buying them (or couldn’t afford).
Ah! Today morning, I woke up to the news of the new Apple products everywhere including Hackernews. As usual, for the kicks, I tried customizing the total spec-out version of the Apple Mac Studio.<p>This is costlier than most typical cars on Indian roads. And the Mac Studio cost do not include the keyboard, mouse, and monitor which is needed to make it the bare minimum usable computer.<p><a href="https://twitter.com/brajeshwar/status/1501440907295752193" rel="nofollow">https://twitter.com/brajeshwar/status/1501440907295752193</a>
Some parts of this price ecosystem would have looked different if Samsung had decided to straighten up their act and not shovel out crapware, adware, and nagware with their so called "Updates" for their lower end phones. It's a lost opportunity for Samsung.<p>Apple gets to do this because their devices seem safer, easier, and faster to use right now.
In Brazil the start model of the new iPhone SE starts at 4200 brl or 835 usd, according to google.<p>The most famous apple joke in Brazil is that it's cheaper to go to US buy a top of the line iPhone, do some tourism and return to Brazil than buying it here.
This makes me wonder how many industries stay underdeveloped due to high hardware prices.
Think of Nigeria movie industry, Brazilian game industry, or even the worldwide impact of high gpu prices due to crypto mining and scarce chips.
Brazil has only itself to blame. Not only Apple products, but several other technology items are pretty expensive due to the VAT (Value Added Taxes), namely, ICMS - state vat tax, IPI - federal vat tax for manufactured products, IOF - federal government tax that incurs on financial trasactions, and high import tariffs. All tariffs and taxes almost doubles the price of everything imported and whenever a product is sold to a distributor and the final seller, state and federal VAT taxes adds up increasing the price even further. Unlike the global north, most of taxes revenues in Brazil come from VAT taxes since brazilian middle class is not willing to pay higher income tax and at the same time they want US-style taxes and European-like lifestyle, such as ree healthcare and free college that are paid in Europe mostly through income tax revenues and dividend tax revenues. So despite higher taxes, it it is not that bad for the upper class and those who can afford Apple gadgets as they would have to pay higher income taxes if they moved to Europe, US or other countries. In Brazil even dividends are not taxed, while in US and Erope they are taxed and companies have to use stock buybacks in order to avoid double taxation.
I lived in Brazil, and my well-off friends bought their Macs smuggled from Paraguay. Still, at Paraguay prices a MacBook Pro used to cost about 10x the minimum wage.
My friends in California enjoy railing against systemic racism except when it's a system that results in my fellow Indians and myself paying more money for the same iPhone. Obviously it's because of import duties and taxes which have nothing to do with Apple, but I'm sure the richest company in the world that is committed to the cause of social justice can find a way to make the pricing fair ;)
My Brazilian friend asked me to recommend her a laptop given her budget. It was certainly an interesting experience. Not only the laptops were much more expensive than they would be in other parts of the world, but also they were older models, with HDDs and 4GB of RAM instead of more up to date models going with SSDs and 8GB of RAM (or more).
I would imagine local laws regarding warranties would also affect pricing. For example, in the US you get one year of warranty, and that's it. In some other countries, there are longer mandatory warranty periods for expensive items. Presumably part of the reason Apple products are more expensive in those countries is that they are on the hook for more warranty service.<p>Interestingly, this means Apple might not care that foreign tourists snap up Apple products when visiting the US. They might claim that those products don't qualify for the enhanced local warranty when the tourists return to their home countries. /speculation
> “Yeah, Apple’s products are pretty good, probably the best depending on what you need from them, but at the end of the day they are not that different from the cheaper alternatives and not really worth the extra money unless you have a lot to spare”. Which, it seems to me, is pretty much what you are going to hear from most people about Apple products anywhere in the world.<p>This could not be further from the truth. I imagine the number of people who think iPhones are the superior product outnumber the number of people who don't really care, and I'd be among them.
Countries like India and Brazil are so stratified in terms of wealth that you essentially have people who have no chance of affording it, ever, and people with the same or more disposable income as those in the west. So the strategy is to simply get as much as possible out of the 'rich' people who will buy it as a status symbol.
It's a long time ago but I once made a business trip to Brazil where local colleagues attempted to explain the reason behind these high prices. I don't remember everything but one example stuck with me: the government forcing the shipment of the incoming goods into a particular harbor that is far away from the end destination, as an attempt to provide them work, and perhaps apply local tariffs. Next, this product needs to be shipped again, probably by air, to the place it needs to be. So it's the distribution of work for the sake of work, keeping each other busy I guess.<p>The other odd thing I noticed back then is electronics that exist nowhere else. For example, an electronics company you may only know for their TVs suddenly also has laptops and phones. But only in Brazil. I guess they are white label products that are rebranded, as part of the "wealth signaling" the author talked about.
Also in my country, very expensive. Therefore, I order from Apple USA directly and import through courier. The exchange rate, courier fee and 15 day arrival 'delay' are much more tolerable than what I would pay for locally at the 'iStore'.
While working on a BigCo product that produced invoices to advertisers in different countries I learned that there are different local laws around invoicing and how a final price is shown to a customer. In the US all prices in our application were exclusive of taxes, which were added after a total cost for customer was computed. For Brazil, a multi month and multi team effort ensued to assure variable tax rates could be applied to different customers and so a only a final price/cost <i>inclusive</i> of “taxes” would be shown to advertisers.<p>… this makes me wonder if taxes/“cost of doing business” is the true cause (something the author waves away without data, and which I don’t have either :) …
Brazil also has world's most expensive cars. We build cars in Brazilian factories and sell them in other countries cheaper than we sell in the local market.<p><a href="https://www.automotiveworld.com/uncategorised/89068-brazil-home-to-the-world-s-most-expensive-cars/" rel="nofollow">https://www.automotiveworld.com/uncategorised/89068-brazil-h...</a><p>And the reason for that is.. that we pay the price. For some reason we accept to pay a higher price than any other country, even though there's a lot of competition (maybe the companies form a cartel here? But why here and not in the rest of the world?)
I still think the reason are custom duties (which I think is something immoral), and anything else is just a consequence. Buying an Apple product from elsewhere is more expensive than buying one here. If that wasn't the case, people would just import the products, and the local businesses would have to adjust or risk bankruptcy.
I recently had to upgrade my really old iPad. I'm not exactly poor but I went for a pretty cheap model as I couldn't mentally justify the prices of the higher end models. The iPad is the only Apple device I'm willing to buy, it's great.
Apple products are so expensive here in South Africa. And we don't have as much disposable cash as Americans/westerners. So yeah adoption is hindered. They don't even try to be competitive unlike Samsung and Huawei do here.
There is joke here that I as an India would like to share.
For the price of the latest iPhone to be bought from a store in India , it is cheaper to buy a two way flight ticket to the UAE , buy the iPhone and bring it back.
Different countries have different import duties, which are "hidden" costs for foreign products. It's possible that these types of tariffs cause Apple stuff to be more expensive in Brazil.
I am lucky enough to live in a country that isn't that bad, however all the Apple stuff I ever owned, wasn't mine rather provided by work/custormer's project.
I think in Argentina they're expensive than brazil. Argentina has a lockdown on dollars actives so it's hard to get dollars to buy such imported products.
iPhone 13 cost R$ 7,599.00, or Roughly $1500 in USD. Compared to $799 in US.<p>On a 30% Import Tax, and a maximum of VAT for Import product alone makes it ~$1250 already. For unstable currency ( comparatively speaking ) Apple tends to hedge at least 15% rate, that makes it around $1437. Apple tends to add a few pcenctage more for those countries with extra consumer protection. ( As in EUR ).<p>So I dont think it is that far off at all.
Why whould anyone care about garbage prices? )
If you wanted some justifiably expensive hardware, buy Sun! Oh, wait, it doesn't exist anymore... (