China smartphone shipments will be 5% less than expected this year, says analyst

The global smartphone market will be adversely impacted by the slowing GDP growth and the plunging consumer spending after the outbreak of novel coronavirus, with smartphone shipments in China expected to be 5% less than previously anticipated, said Strategy Analytics.

Strategy Analytics analyst Linda Sui said in a report published on Thursday that the epidemic will hit the China and global economy during H1 2020. It will also impact global smartphone supply and manufacturing, because China makes 70% of all smartphones sold on the planet.

Any delay of operations for factories, by quarantine or travel restriction, will inevitably cause temporary labor-supply shortage, she said.

Strategy Analytics forecast the global market will ship -2% fewer smartphones than expected in 2020, due to the fear and “paralysis” caused by coronavirus. China smartphone shipments will be -5% less than expected in 2020. The biggest impact will hit China, but other connected economies will feel a ripple, like Japan or the US.

Leading Chinese vendors, such as Huawei, OPPO, vivo and Xiaomi, are facing strong headwinds from coronavirus and we expect them to suffer badly at home in the first half of 2020.

The report recommended semiconductor makers, operators, service and content providers, as well as related parties, closely monitor their channels and plan well ahead, to avoid inventory.

The report said that the above forecast is based on the current development of the epidemic and the assumption that it can be effectively controlled in late February and March. If the development of the epidemic in China and the world cannot be effectively controlled at the above-mentioned time, the negative impact on the market will further expand and worsen.