Chinese smartphone market to shrink by double digits in 2H20

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As much as the entire world, China, which was the origin of the COVID-19, is still reeling from the pandemic with infections fluctuating every now and then. Just when we thought the situation might improve, Digitimes has come up with a report claiming that the smartphone market in China will be slapped with a double-digit decline in the second half (H2) of 2020.

As stated by the report, Chinese vendors with whom the OEM work for making the smartphones, deal with local market and overseas demand. It adds that the local market in China has not come out of the pandemic yet and this will hamper the domestic shipments in H2 2020 as the domestic demand remains slump.

Obviously not good as last year

Previously, the shipments recovered to a solid 43.3% in Q2 2020 which accounted for 157 million units compared to the earlier quarter. The swift action of the channel networks who restocked the inventories at the right time was the reason for these better numbers. 

However, the current year has recorded a 15.2% dip in shipments. And Q2 2019 numbers were far better than these figures. In addition to this, March-May saw a complete stall in the exports department. This made domestic brands like Huawei, Xiaomi, Oppo, and Vivo to focus on the local smartphone market.

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To their dismay, almost all of them except Huawei faced a severe decline in shipments compared to 2019, despite occupying 82.3% of the total domestic shipments in Q2 of 2020. Huawei, the reigning champion set its foot strong with a 2.1% YoY growth rate.

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Can the smartphone market and OEMs recover?

Xiaomi was the worst hit of all with a 27.1% decline in shipments as the company often relies on overseas markets despite being called China’s Apple at times.

That said, companies are looking for ways to crawl up the ladder at least in the remainder of 2020 by introducing fast charging, bigger cameras and affordable 5G at around CNY1000($143) in smartphones. 

However, similar to Indian Market which saw a near 48% dip in sales, the report says China’s lower demand and a fluctuating pandemic on the Global markets will hamper the shipments in the remaining half of 2020.

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1 Comment

  1. Cyril Dieudonne
    July 28, 2020

    it’s good for the environment. Let’s shrink the market. Less waste, less shipping pollution, and less market saturation. Stop producing 1000 phones that are slightly different, almost identical. Better to make a good one every two years rather than crap with only one megapixel or 3 min battery improvement.