Canadians are accustomed to encountering higher prices compared to their American counterparts, but the pricing disparity for the latest iPhone has raised eyebrows. Apple’s new foldable phone, the iPhone Duo, was unveiled on Wednesday with prices ranging from $2,999 to $4,799 in Canada before taxes. In the U.S., prices start at $1,999 US, equivalent to around $2,760 in Canadian dollars, resulting in Canadians having to pay nearly 10 percent more for the base model.
The steep pricing elicited criticism and jests on a Canadian Reddit forum, with one user suggesting that anyone spending such a significant amount on a phone should undergo a financial literacy course. Another user humorously noted that in the past, the same amount could have bought a car.
According to University of Toronto economics professor Joseph Steinberg, the price hike likely indicates that Apple identified a segment of the Canadian population willing to purchase a “super-premium product” like the Duo, who are less sensitive to price compared to American consumers, allowing Apple to increase profit margins.
Steinberg mentioned that while it is common for electronics and other products to be pricier in Canada, the exceptionally high cost of the iPhone Duo makes it stand out. Some had speculated that Canada’s retaliatory tariffs on U.S. products might have influenced the iPhone prices, but experts clarified that this was not the case. Despite smartphones being included in the list of U.S. products with tariffs, Canada does not import these devices significantly from the U.S. Furthermore, since the iPhone Duo is manufactured in China, it is not subject to the tariffs on U.S. goods.
Addressing the global microchip shortage, Werner Antweiler, chair in international trade policy at the University of British Columbia, explained that the rise in smartphone prices is due to the shortage caused by the AI industry’s growth and the proliferation of data centers, leading to increased manufacturing costs. While surprised by Apple’s specific price hike for Canadian consumers, Antweiler noted that U.S. companies commonly engage in price discrimination practices, with Canada often paying slightly more due to its smaller market size.
Apple has been contacted for comment by CBC News but has not responded. Apple CEO John Ternus introduced the iPhone Duo during the event, marking a significant shift in the company’s flagship product in his first event as CEO. Pre-orders for the Duo will commence on Oct. 17, with the phone becoming available on Oct. 23.