The Elec has learned that the Chinese technology giant Huawei plans to produce about 50 million smartphones in 2021. Thus, it will be 74% lower than the company’s expected shipments in 2020.
People familiar with the matter said that Huawei and South Korean subcontractors shared this 2021 target.
Huawei shipped 240 million smartphones in 2019 and is expected to ship 190 million units this year. The 2021 targets are equivalent to 21% and 26% of these shipments, respectively.
Huawei’s downward adjustment of its shipment targets is mainly in response to US sanctions, which are hindering its ability to obtain smartphone components. Starting on September 15, the company will be banned from purchasing semiconductors used in smartphones and laptops. Huawei can use the chips in its inventory. But it cannot use the latest processors that its competitors will use.
Huawei’s competitors such as Samsung may benefit from this latest development, especially in markets such as China and Europe.
Huawei’s sales last year were 858.8 billion yuan ($125.4 billion). 506.7 billion yuan (59%) came from China and 206 billion yuan (24%) came from Europe ($74 billion and $30 billion, respectively).
Samsung To Fill The Gap Left By Huawei
People familiar with the matter said that Samsung’s goal is to expand its market share in Europe next year. The company ranked first in the region. But in the first half of 2020, its shipments and share declined.
Samsung’s goal is to ship 300 million smartphones in 2021. Samsung shipped 295 million smartphones in 2019. And this year’s shipments are expected to be between 240 million and 260 million. Based on this calculation, the growth rate in 2021 is 15%. In addition, Huawei’s sanctions by the United States are also good for Samsung. In other words, Samsung clearly hopes to grab the market share that Huawei has lost.
Samsung’s goal is to actively develop in India next year. However, the company does not want such an aggressive promotion in China because its market share in China is less than 1% and it is unlikely to return to its past glory in China.
It is worth noting that due to the new coronavirus epidemic, the situation in the smartphone market in the first half of this year has become more severe. Even the performance of the Samsung Galaxy S20 series phones has fallen short of expectations. The company found that sales of this phone were weak at the beginning of the year. But they expect it to recover in the second half of the year.
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Huawei had stated that before the US sanctions, its goal was to become the largest smartphone manufacturer this year. In fact, the company was the largest smartphone manufacturer in the second quarter of this year.