Low consumer confidence is made up by price reduction
Global smartphone shipments are expected to reach 1.2 billion this year, down nearly 12% year-on-year, according to the latest data released on Wednesday by IDC, a market research firm. The novel coronavirus pneumonia not only impacts the supply chain of the market, but also damages consumer confidence.
This is the second time IDC has lowered its global smartphone delivery forecast this year. At the beginning of February this year, IDC predicted that the sales volume of smart phones would drop by 2.3% in 2020, with the shipment volume slightly higher than 1.3 billion.
IDC also predicted earlier that global smartphone shipments in the first half of this year would fall by 10.6% year-on-year, with global shipments likely to grow again in 2021, in part because the market is more focused on 5g. In addition, it will take several quarters for manufacturing and logistics to recover.
In the first quarter of this year, global Smartphone Production has fallen by 10%. According to research firm trendforce, global Smartphone Production will accelerate to decline by 16.5% in the second quarter of this year. It also expects global smartphone shipments to fall 11.3% to 1.24 billion this year.
The previous outbreak has had an impact on Apples and Samsungs financial performance in the first quarter. As apple was forced to close stores in the United States and Europe, the company placed a bigger sales target on the Chinese market. Recently, Apple announced a new round of price reduction measures for old models.
First financial reporter noted that the price of iPhone in multiple e-commerce channels of apple, including Alibaba tmall and jd.com, was further reduced. On tmall, the price of iPhone 11 series models has been reduced by 13%, for example, the original price of iPhone 11 (64g) models has been reduced to 4779 yuan from 5499 yuan; the starting price of iPhone 11 Pro has also been reduced to 7579 yuan from 8699 yuan; the original price of iPhone 11 promax has been reduced to 8359 yuan from 9599 yuan; and the starting price of the latest low-priced iPhone ese models has been reduced to 3099 yuan.
The promotion price on JD platform on June 1 shows that the price of iPhone 11 (64g) and iPhone 11 Pro are adjusted to 4599 yuan and 6999 yuan respectively; if the total discount is included in the price of iPhone 11 promax, the price reduction is even more than 20%, and the price is only 7499 yuan.
The price cut has greatly boosted sales in Jingdong, which revealed that trading volume tripled year-on-year within an hour after the promotion price was launched on June 1. But the price on Apples official website has not been adjusted.
Peng Luping, an analyst at canalys, a research institution, told CFI: low price iPhones attract more users attention in the current economic situation. Some users dont want to spend more than in the past to buy mobile phones, but they still have the need to change their phones, and the price reduction keeps these users.
IPhone sales rebound in China
In April, Apples sales in China have rebounded strongly. Apple shipped 3.9 million units in China in April, up 160% from March, according to cinno research. According to IDCs data from channel providers, Apples shipments to channel providers reached 3 million in April, an increase of about 30% over March.
Chinas mobile phone shipments in novel coronavirus pneumonia fell 18% to 72 million 600 thousand in the first quarter, according to a report released earlier by Canalys. Among them, Huaweis market share rose to 41.4% from 33.9% a year ago, while the overall shipment volume in the first quarter rose by 1% to 30.1 million units.
Apples shipments in China fell more than 4%, but its market share in China rose to 8.5% from 7.3% a year ago. Apple CEO Cook said at last quarters earnings conference that sales in China are on track..
However, Apples market share in China is still behind that of oppo, vivo and Xiaomi, both of which are 26% and 19% respectively.
Analysts believe that compared with the impact of the epidemic on the supply chain on apple, the weak demand side of consumers puts more pressure on Apples sales. Tianfeng securities has previously lowered its outlook for iPhone shipments in the second quarter to 29 million to 32 million units, down 20% to 25% year-on-year.
We believe that Apples execution can minimize the risk of any delay in development and mass production, and suggest that investors should pay more attention to the impact of consumption degradation on iPhone demand. Tianfeng securities wrote in the report.
The impact of the epidemic on consumer confidence may also delay consumers demand for 5g mobile phones. We are cautious about the overall situation of Chinas smart phone market this year, and the macro-economic situation is still very uncertain for mobile phone manufacturers, Peng Luping, of canalys, told CFI
It is widely expected that the launch of Apples 5g mobile phone will be largely constrained by the supply chain and may be delayed. At the same time, apple is facing fierce competition from Android phone manufacturers. Chinas local manufacturers, including Huawei and Xiaomi, have launched 5g mobile phones, and expect 5g mobile phones to stimulate the demand of customers for replacement.
In the best case scenario, canalys expects Chinas smartphone shipments to reach 326 million this year, including 137 million 5g smartphones. The first financial reporter previously obtained information from a Chinese securities firm that Apple will launch three iPhone models in the second half of this year, namely iPhone 12, iPhone 12pro and iPhone 12promax. The total stock of the three phones this year is expected to be 90 million, some of which use sub6 (low to medium frequency band spectrum) and a small part use sub6 + millimeter wave. According to the latest Nikkei news report, citing Apples supply chain, Apple plans to produce about 213 million iPhones in the 12 months to March 2021, an increase of 4% over the same period last year. Source: Guo Chenqi, editor in charge of the first financial daily_ NBJ9931
In the best case scenario, canalys expects Chinas smartphone shipments to reach 326 million this year, including 137 million 5g smartphones.
The first financial reporter previously obtained information from a Chinese securities firm that Apple will launch three iPhone models in the second half of this year, namely iPhone 12, iPhone 12pro and iPhone 12promax. The total stock of the three phones this year is expected to be 90 million, some of which use sub6 (low to medium frequency band spectrum) and a small part use sub6 + millimeter wave.
According to the latest Nikkei news report, citing Apples supply chain, Apple plans to produce about 213 million iPhones in the 12 months to March 2021, an increase of 4% over the same period last year.