Canadians are accustomed to encountering higher prices than their counterparts in the U.S., but the cost 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, equivalent to $2,760 in Canadian dollars, indicating that Canadians will need to pay nearly 10 percent more for the base model.
The steep prices sparked criticism and humor on a Canadian Reddit forum, with one user suggesting that individuals splurging on such an expensive phone should undergo financial literacy training. Another commenter remarked, “You used to be able to buy a car for that amount.”
According to University of Toronto economics professor Joseph Steinberg, the price increase likely indicates that Apple identified a segment of the Canadian population willing to purchase a “super-premium product” like the Duo, which is “less sensitive to price” compared to American consumers, allowing Apple to raise margins. Steinberg mentioned that while it is common for electronics and other products to be pricier in Canada, the exorbitant cost of this phone makes it particularly noticeable.
Speculation arose regarding whether Canada’s new retaliatory tariffs on U.S. products would impact iPhone prices. However, experts clarified that this is not the case. Despite smartphones being among the U.S. products subject to a 50 percent tariff, Canada does not significantly import these devices from the U.S. Additionally, the tariffs do not apply to the iPhone Duo as it is manufactured in China, making it a product originating from China, not the U.S.
Werner Antweiler, chair in international trade policy at the University of British Columbia, explained that the escalating prices of smartphones globally are due to the microchip shortage caused by the AI boom and data center expansion, creating high demand driving manufacturing costs upwards. He expressed surprise at Apple’s decision to raise prices more for Canadian consumers, noting that U.S. companies often practice price discrimination.
Antweiler highlighted that price discrimination of 10 to 15 percent is common in Canada due to the market’s willingness to pay more, given its smaller size compared to the U.S. Efforts to reach Apple for comment have been unsuccessful. Apple CEO John Ternus unveiled the iPhone Duo on Wednesday, marking a significant change to the company’s flagship product in his first leadership event. Pre-orders for the Duo will commence on Oct. 17, with the phone available for purchase on Oct. 23.