Canadians are accustomed to encountering higher pricing than their counterparts in the U.S., but the cost disparity for the latest iPhone has raised eyebrows. Apple’s newly unveiled foldable phone, the iPhone Duo, is being sold in Canada at prices ranging from $2,999 to $4,799 before taxes. In the U.S., the prices start at $1,999, equivalent to $2,760 in Canadian dollars, resulting in Canadians having to shell out nearly 10% more for the base model.
The steep prices sparked ridicule and banter on a Canadian Reddit forum, with one user suggesting that individuals splurging that much on a phone should be mandated to undergo a financial literacy course. Another user humorously remarked that the amount could have previously bought a car.
According to University of Toronto economics professor Joseph Steinberg, the increased pricing likely indicates that Apple identified a segment of the Canadian populace willing to purchase a “super-premium product” like the Duo, which is “less price sensitive” compared to American consumers, allowing Apple to slightly boost profit margins.
Despite speculation that Canada’s new retaliatory tariffs on U.S. products could lead to higher iPhone prices, experts clarified that this is not the case. While smartphones are among the U.S. products subject to a 50% tariff, Steinberg explained that Canada does not significantly import these devices from the U.S. Moreover, the tariffs do not apply to the iPhone Duo as the phones are manufactured in China, making them Chinese products rather than American.
The global microchip shortage, triggered by the AI boom and the proliferation of data centers, is driving up manufacturing costs for electronics, including smartphones. Werner Antweiler, chair in international trade policy at the University of British Columbia, highlighted that virtually all electronics in Canada originate from Asia and contain components from various global sources.
Antweiler expressed surprise at Apple’s decision to raise prices more for Canadian consumers, although he noted that price discrimination is not uncommon among U.S. companies. He emphasized that Canadian markets typically accept price differentials of 10 to 15% compared to the U.S. due to Canada’s smaller market size.
Apple has not responded to CBC News’ request for comment. Apple CEO John Ternus introduced the iPhone Duo during a significant product launch event, marking a significant shift in the company’s flagship product under his leadership. Pre-orders for the Duo will commence on Oct. 17, with the phone hitting the market on Oct. 23.
