The iPhone has lost its crown as the best-selling phone in China, dropping to 3rd place in the latest market intelligence data.

One factor is the company’s struggle to launch Apple Intelligence features in the country after being unable to get permission to use its own generative AI model there …

Canalys reports that iPhone shipments in China fell by 25% year-on-year in the final quarter of the year.

Vivo led the market for the year with a 17% market share, shipping 49.3 million units. Huawei ranked second with 46.0 million units shipped, achieving an impressive year-on-year growth of 37%. Apple, OPPO and HONOR followed in third, fourth, and fifth place respectively, each holding a 15% market share.

That means Apple’s market share fell from a chart-topping 19% in 2023 to joint-third with Oppo and Honor in 2024, each with a 15% share.

Local brands were able to offer AI features, while Apple has yet to strike a deal to launch Apple Intelligence. The Financial Times cites this as a key factor in the change of fortunes.

The figures come as the US technology company faces growing pressure from local premium smartphone brands, particularly Huawei, which have benefited from patriotic buying and the ability to roll out artificial intelligence-powered features to their devices. The company’s Apple Intelligence service is not available on the Chinese mainland.

As we’ve previously noted, China requires all generative AI models to have government approval in order to maintain its tight stranglehold on sources of online information within the country. Many existing western platforms are blocked by the Great Firewall of China – including Facebook, X, and Wikipedia – and Google pulled out from the country rather than give in to censorship.

The government last month said that launching Apple Intelligence in China would be a “difficult and long process” unless the iPhone maker partners with a local AI company. Working with a Chinese company would instead be “simple and straightforward.”

Source: 9to5mac