Apple is reportedly planning to release a new version of the iPhone designed specifically for the Chinese market. The new phone would ditch Face ID in favor of an under-the-display fingerprint sensor, largely in an effort to cut costs and remain competitive during the ongoing trade war between the US and China.

The move would be a major concession for Apple, which has heavily prioritized Face ID in recent iterations of the iPhone. The report itself comes courtesy of the Global Times, which cited sources in Apple’s upstream manufacturing chain. According to the report, the structured light laser emitter that powers Face ID is an expensive component that drives iPhone prices beyond the comfort window for Chinese smartphone buyers.

At the moment, Apple has nine percent of the Chinese smartphone market, while Huawei leads the domestic market with 34 percent. The Global Times indicated that Apple is desperate to maintain its foothold in the country, and is even trying to move the manufacturing of some products to China to further reduce production costs. However, there is some concern that doing so would negatively affect Apple’s high-end brand image in the country.

The US-China trade war has already created minor complications for a planned acquisition of the company that makes Face ID’s surface emitting laser. The latest news suggests that the ripples are starting to expand, and that they could be much, much bigger than expected if Apple is considering dropping its Face ID investment in the lucrative Chinese market.       

Source: The Global Times