A new outbreak of COVID 19 threatens to plunge the Chinese
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A new outbreak of COVID-19 threatens to plunge the Chinese smartphone market by 20% – Apple will be the most stable

Another outbreak of COVID-19 infections in China could significantly reduce sales in the world’s largest smartphone market if authorities fail to contain it in time. However, Apple has the ability to withstand this blow and even increase its market share.

    Image source: apple.com

Image source: apple.com

The day before, more than 20,000 cases of COVID-19 infection were officially registered in China, most of them in Shanghai. Authorities have once again put the city under strict lockdown, threatening logistics and much of the consumer market. Pundits are bearish: Strategy Analytics’ Neil Mawston expects smartphone shipments to fall 20% year over year in the second quarter, and Counterpoint Research’s Neil Shah is forecasting a 12% to 13% drop in sales in April and May compared to the same period last year last year.

Mr Shah believes that a full resumption of sales cannot be expected before June and retailers will be forced to offer significant discounts so that the final drop does not exceed 3-4%, but if the situation with the infection cannot be corrected, the entire year may be marked by a 12% decline in sales. The most optimistic forecast came from IDC’s Will Wong: Sales in the second quarter fell 3.4% on a yearly basis.

The Chinese Android smartphone market remains highly competitive, with companies like Xiaomi, Oppo and Vivo all fighting relentlessly for a piece of the naturally shrinking pie. Against the backdrop of this struggle, Apple continues to feel good: In the second quarter, the company’s shipments could fall by about 4-5%, Mr Shah says, but this is partly a seasonal effect as it has been a long time since the September announcement of the new iPhones.

Another key to Apple’s success is Huawei’s exit from the premium smartphone market: due to US sanctions, the Chinese manufacturer has lost access to advanced components. Therefore, it is likely that Apple will increase its share of the Chinese market in 2022, even against the background of problems with outbreaks of infection: consumers who prefer its products could be attracted by the updated iPhone SE, which comes with support for the widespread 5G networks in the country.

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Johnson Smith

Johnson Smith is interested in Home Theater & Audio, Smart Tech, Google News & Products, How To, Apple News & Products, Cell Phones, Automotive Technology.

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