Apple India Sales Execs Depart as Market Poses a Challenge

Apple Inc.’s (AAPL) struggles to conquer the world’s fastest-growing major smartphone market, India, has prompted an exodus of several of its top sales executives in the country, according to Bloomberg.

The report, citing anonymous sources, added that Apple’s India sales team is currently undergoing a restructuring phase. The executives who departed due to the iPhone maker’s "persistent malaise" in the country are the national sales and distribution chief, the head of its commercial channels and mid-market business and the head of telecom carrier sales.

Apple’s India Struggles Exposed

Despite CEO Tim Cook’s bullish progress reports on Apple’s Indian operations, it appears that the iPhone maker has made little ground in its bid to significantly grow market share in the country, which is still at 2%. Apple depends on the sales of its cheaper, older iPhone models in the country, but high tariffs are said to inflate the retail prices of imported gadgets, leading local consumers to purchase cheaper smartphones from companies that manufacture domestically like Xiaomi Corp. and Samsung Electronics Co. Ltd. (See also: Apple iPhones Sold in India Are 40% More Expensive)

Bloomberg’s sources claim that Apple’s sales team has struggled to cultivate business relationships in India and continues to experience difficulties understanding how things work in the country. This unfavorable situation, they added, has left employees direction-less.

“iPhone India sales were weak in the first half of 2018 and, even if they show a big jump in the traditionally strong second half, Apple will still fall short of last year,” said Neil Shah, a research director with Counterpoint Research, to Bloomberg. “It has not put great focus or investments into India because the market is so minuscule. The inattention could send more users to Android phones, making it difficult for Apple to build a user base and win loyalty. It’s a Catch-22 situation for Apple in India.” Apple sold fewer than a million devices in India in the first half of 2018, according to Counterpoint.

News of Apple’s struggles in India stand in contrast to Cook’s upbeat comments on how the company is progressing in the country. In May, the CEO said on a conference call with investors that India had set a new first-half sales record. (See also: Apple Planning Series of Upgrades This Fall: Top Analyst)

Cook previously expressed his confidence that Apple could replicate its success in China, now the company’s second largest market, in India. While the iPhone remains too expensive for most Indians, Cook claimed that young, aspiring people in the country are rapidly becoming much wealthier. (See also: 5 Reasons Apple Stock Is a Buy: Citigroup Analysts)