17 October 2018
Most resold iPhone 6 handsets in Hong Kong will arrive at the Sin Tat Plaza in Mong Kok before being passed on to the Huaqiangbei shopping mall in Shenzhen.
Most resold iPhone 6 handsets in Hong Kong will arrive at the Sin Tat Plaza in Mong Kok before being passed on to the Huaqiangbei shopping mall in Shenzhen.

iPhone 6 frenzy in HK: Who is benefiting?

With the iPhone 6 finally hitting the stores, there is the familiar mad scramble outside Apple shops in Hong Kong. Gadget geeks, traders and scalpers all want to lay their hands on the new smartphones, for their own reasons. 

While some devout iPhone fans are seeking the larger-screen phones for their own use, most of the people thronging the stores in Central, Causeway Bay and Kowloon Tong are seeking to profit off the new devices by reselling them at huge premium.

This is of course nothing new, as we have seen the same thing during Apple’s previous launches in the city. In fact, ever since the US tech giant opened its first retail store here three years ago in Central, Hong Kong has become the trading hub for Apple products in the Greater China region.

That said, there is more than the usual speculative activity this time around, as the handsets are enjoying more-than-the-normal mark-up in the grey market. 

While some loyal Apple fans will not resell their phones, whatever the price offered, most buyers now are treating the iPhone 6 launch as a lucky draw or Mark Six lottery, hoping to resell the handset for a tidy profit and use the money on other things — perhaps, a short trip to Japan, Korea or Singapore.

For the cheapest model iPhone 6 with 16GB storage, the secondary market is offering between HK$8,000 and HK$8,800, against Apple’s official selling price of HK$5,588. Thus, a reseller can make up to HK$3,212 on a unit, a gain of almost 60 percent.

For the bigger screen iPhone 6Plus with 128GB storage, grey market price is even crazier, with the model commanding a price range of HK$16,500 to HK$18,000, more than double its original price HK$8,088 and offering a return of up to 122 percent to the seller.

The higher premium for the iPhone 6 Plus, the bigger model which bears a 5.5-inch screen — the iPhone 6 has a 4.7-inch display — is mainly due to insufficient supply. According to sources familiar with the industry supply chain, iPhone 6 Plus shipment only accounts for less than 20 percent of the total shipment by Hon Hai Precision, the contract maker of iPhones.

The supply shortage, and the Chinese users’ preference for big screen devices, have driven up the iPhone 6 Plus price in the resale market.

The huge jump in reselling prices is mainly due to strong customer demand from China, Taiwan and Macau, as well from other Southeast Asian countries, as Hong Kong was the only market in the Greater China region to debut the phones on Friday.

But the overwhelming reason is demand from mainland traders who hope to reap quick gains without much effort.

Given the big market in China and the huge demand there, it is still a mystery as to why Apple did not include the mainland in the first batch of iPhone 6 sales.

Some media reports suggest that the company was forced to delay the launch in China as mainland authorities are yet to approve a key network license.

In the meantime, in a bid to retain some business from China, Apple has for the first time allowed mainland users to register for online pre-orders through Apple Hong Kong online store, using their China identity cards. But the move has angered some Hong Kong Apple fans who accused the US firm of not giving top priority to them.

As the iPhone fever rages, one thing is clear overall: Trading new Apple gadgets has become a ritual in Hong Kong every autumn. Some white-collar workers even look upon Apple’s new launches as a chance to earn mid-year bonus.

Now, what about the genuine users who want the phone for their own use? Well, they would need to sign up for a service plan with a mobile operator with 24-month contract if they want the iPhone 6 in the near term, or wait for a few months until there is enough supply in the market.

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EJ Insight writer

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