According to experts, last year was marked by a sharp drop in demand for laptops. TrendForce, reducing the volume of their deliveries by the end of the year by 24.5% to 186 million units. This year, shipments are expected to fall another 7.8% to 171 million units, and the first quarter of this year will generally be marked by a 10-year low in laptop offerings.
Attempts by suppliers to lure buyers with discounts in the last quarter were not very successful, according to the study’s authors. Manufacturers lowered prices on the US and Chinese markets, but these actions did not bring the desired results. High inflation expectations continue to dampen buying activity and the laptop segment is no exception, especially given the high sales growth during the pandemic. In fact, the sellers will have to work on emptying the warehouses up to and including the second quarter of this year.
The first quarter of 2023 alone will be marked by a decline in notebook shipments to 35.1 million units, down 9.5% sequentially. This corresponds to a seasonal ten-year low. Anticipating the traditional Chinese holiday at the end of January, laptop sellers built up stocks at the end of the last quarter, and now the new batches in the current quarter will be smaller.
According to the forecast TrendForce, the decline in the volume of shipments of laptops in the first quarter for the second will be replaced by a continuous growth of 17.8%, in the third quarter growth will slow to 13.7%, and only in the fourth quarter of this year will be shipped only 2, 2% more laptops than the third. It will be possible to talk about some stabilization of the situation with deliveries.
Among other key market trends, TrendForce experts point to manufacturers’ desire to move their laptop assembly plants outside of China. Contract manufacturers, represented by Compal, Wistron and Foxconn, have already started expanding notebook production in China. The relatively large and young local population is a more affordable labor force compared to Chinese comrades, and the only problem for market participants is the increasingly complex logistics of the components, most of which still have to be transported from China.
According to TrendForce, a major supplier of laptops to the American enterprise market (estimated to be Dell) has already set a goal of reducing its dependency on the Chinese manufacturing base to 20 or 30% by 2027, according to TrendForce officials. By the end of the current year, up to 20% of devices of this brand will have to be produced in Vietnam.
Another supplier of laptops of a well-known American brand, which can boast of using its own processors (Apple, you must understand), will bring the share of Vietnamese-made laptops in its product structure to 10% this year.
A third supplier of laptops for the US market is ready to use the second approach to reduce dependence on China. He intends to organize the assembly of the devices in close proximity to the US borders – specifically in Mexico. For the Indian market, this manufacturer is ready to organize the production of equipment on the territory of this South Asian country. The local market is interesting because the population of India could overtake China this year and electronics suppliers are trying to take advantage of the prospect of increasing sales volumes.