Coronavirus pandemic has forced record smartphone production cuts

Even though China’s supply chain comes to life after a shutdown for most of the first quarter, the global smartphone market is expected to contract sharply in the second quarter due to the lingering effects of coronaviruses.

Apple’s iPhone 11 Pro lineup represented a high percentage of what Apple built in the first calendar quarter of 2020

The first calendar quarter of 2020 was impacted by the closure of the smartphone supply chain due to the coronavirus pandemic. However, this virus will have demand effects that will continue into the second quarter, according to a new study from Trendforce.

In a report released Thursday morning, Trendforce estimates that global smartphone production for the first calendar quarter of 2020 fell 10% year-on-year to 280 million units in the industry. If correct, it is the world’s smallest volume of smartphone production in five years.

Forecast of smartphone volume for the first and second quarters of 2020
Forecast of smartphone volume for the first and second quarters of 2020

Although the company recognizes that the supply chain is now recovering, the destruction of demand and major economic collapses will have an additional impact on consumer demand. Due to the combined impact, the year-over-year decline in the second quarter will be 16.5% to approximately 287 million units produced.

Apple-specific impacts on demand and deliveries

Apple’s overall deliveries are in third place, behind Samsung at number one and Huawei. Trendforce estimates that Apple’s first quarter shipments fell 8.7% year over year to 37.9 million units this quarter.

The Apple iPhone SE, valued at $ 399, was released – and primarily produced – in the second fiscal quarter of 2020. The firm estimates that Apple will ship approximately the same volume of iPhones from a quarter to quarter during the second quarter which started on April 1, which comes out about the same as it shipped in 2019 in the same quarter.

The company does not say much about the “iPhone 12” 5G expected in the fall. He says that the potential drop in demand for the model is a “notable concern”, but does not elaborate further.

Impact on Apple’s competitors

Samsung is expected to experience “limited growth” in 2020, even before the coronavirus epidemic. Samsung’s normal production of its entire line of smartphones, up to $ 99, totaled 65.3 million units in the quarter, down 9.9% year-over-year despite the launch of the flagship line. Galaxy S20 during the quarter. The company is expected to see a 10.7% quarter-over-quarter decline to 58.3 million units.

Chinese market demand in China for Huawei phones has offset Huawei’s global decline, given Google’s lack of assets, with the company shipping 46 million units in the first quarter of 2020. Research by Trendforce, Huawei could benefit from the impacts of other players locally, with the company potentially shipping 48 million units in the second quarter of 2020.

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