Apple’s ambitious plans to launch a plastic version of the Apple Watch SE, aimed at offering a more affordable, kid-friendly option, are reportedly facing significant hurdles in development. According to Bloomberg’s Mark Gurman, the project is now in “serious jeopardy” due to a series of production difficulties.
The new plastic variant, which was expected to be a cheaper alternative to the current aluminum model, has encountered several obstacles, including design and cost issues. “The design team doesn’t like the look, and the operations team is finding it difficult to make the casing materially cheaper than the current aluminum chassis,” Gurman noted in his Power On newsletter.
Despite these setbacks, the push for a more budget-friendly Apple Watch SE is part of Apple’s broader strategy to tap into the growing kid-friendly smartwatch market. Research from Counterpoint Research has highlighted that the kids’ segment saw notable growth in 2024, making it a key focus for tech companies.
Apple’s previous version of the Apple Watch SE was launched more than two years ago, and many industry observers have expected an update to the product line. However, the smartwatch market has seen a slowdown in global shipments. In 2024, smartwatch shipments experienced a 7% year-on-year decline, marking the first-ever drop in the segment, according to Counterpoint Research. The report attributes the downturn largely to a decline in Apple’s own shipments, as demand for basic smartwatches stagnated amidst a broader market slowdown.
Even with this decline, Apple remains the leading smartwatch brand, maintaining a 22% market share in 2024, despite a 19% drop in shipments compared to the previous year. This demonstrates Apple’s continued dominance, even as it faces growing competition in the smartwatch space.
In addition to the challenges surrounding the Apple Watch SE, Apple is reportedly working on introducing new models of the Apple Watch with built-in cameras. These devices are expected to incorporate AI-powered features, such as Visual Intelligence, which debuted on iPhones. This technology enables users to scan objects, landmarks, and text for instant AI analysis, further solidifying Apple’s commitment to expanding the role of artificial intelligence across its product lineup.
Despite these innovations, Apple’s focus on AI and kid-friendly wearables highlights its ongoing efforts to diversify its offerings in a competitive and rapidly changing market. However, the company’s struggles with the Watch SE suggest that bringing affordable, mass-market models to market will require overcoming significant design and production challenges.