Chinese smartphone makers have managed to maintain the industry’s growth momentum this year, although this means grabbing some of the market share of leading players such as Samsung Electronics and Apple in various markets.
Chinese players are also expected to lead the charge as the sector prepares for the advent of the 5G mobile technology.
Taiwan media reports that Huawei Technologies is targeting a 25 percent shipment growth next year to around 200 million units, while Xiaomi expects to boost its shipments by 20 percent to around 150 million to 160 million units. Vivo and OPPO, which are under the same owner, are eyeing a 10 percent shipment growth.
For Huawei and Xiaomi, 2019 will be crucial as it offers the chance for them to climb to the top spot in the global smartphone market if their 5G offerings are well-received. Huawei, which has taken the No. 2 position from Apple this year, is ready to wrestle the crown from Samsung as the Korean giant suffers from a weak performance in China.
Currently, Samsung holds only a 1 percent share of the world’s largest smartphone market, compared with Huawei’s commanding 20 percent. Given such a big gap in their performance in China, Huawei could ease out Samsung from the top spot in the global market in two years if it manages to keep its growth momentum.
Apple, on the other hand, will continue to face pressure from Xiaomi as it defends its No. 3 market position. Apple was able to maintain its shipment volume in the third quarter against the same period last year. But the question is whether it could go on with its pricing strategy given the lukewarm sales of its new iPhone series this year.
Apple, in fact, is relying on old models to maintain its market share. Many Apple fans are buying older flagship models at cheaper prices following the launch of a new series.
According to market rumors, Apple has started to produce iPhone X again in order to meet the strong demand. This suggests that the tech giant may need to adjust its pricing strategy to maintain demand for new models. Otherwise, it could be eased out of the top five as iPhone is getting out of reach of the mass market.
Apple is expected to maintain the same level of shipment it had in previous years or even see it decline. If that happens, Xiaomi, which is seeking to ship more than 150 million units next year, can easily unseat Apple from the third place.
Xiaomi is doing well not only in China but also in India and Southeast Asia. It has also started to expand in Europe. However, it will face tough competition in the European market, where Huawei has been performing strongly over the past few years.
Vivo and OPPO are also doing quite well in China, especially in the offline market, thanks to their strong local retail networks and heavy sponsorship of television programs.
The two are now offering high-end products such as Vivo NEX and OPPO Find in a bid to tap the high-tier market segment.
Chinese media reports said Vivo NEX, which is the first full-screen smartphone with a hidden front camera, has sold more than 2 million units in China and brought in more than 100 million yuan (US$14.57 million) in revenue. Vivo is now preparing to launch a new NEX model with a dual-screen display by the end of the year.
The global smartphone market is witnessing a slow but steady uptick. In the third quarter of 2018, handset sales grew 1.4 percent from the same period last year to 389 million units, according to the latest Gartner report.
Shipments were led by Chinese brands Huawei and Xiaomi, with Huawei seeing a 43 percent growth in demand for its devices.
In fact, Anshul Gupta, research director at Gartner, said smartphone sales to end-users would have declined by 5.2 percent during the period if Huawei and Xiaomi were excluded from the vendors’ list.
According to Gartner, new technologies such as 5G and foldable phones will spur the next wave of market demand. Sales of 5G mobile devices alone are expected to reach 65 million units in 2020.
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