Huawei Technologies Co. and Xiaomi Corp. have activated the Chinese mobile phone market, which showed double-digit growth in October.
The commercial space of this Asian country, within which smartphone sales are carried out, this year faced two serious challenges in the form of oversupply and weakening of the economic system of the state.
Counterpoint Research data shows that in October, the level of phone sales in the Chinese mobile market, which is the largest in the world, increased by 11% compared to the result for the same period last year. Local consumers prefer the products of domestic manufacturers. Huawei’s sales volumes in October showed an increase of 83% year-on-year. The same indicator of Xiaomi has grown by a third compared to the result of a year ago.
The debut of the new generation iPhone from Apple Inc. in China this year was a very limited event in terms of consumer interest and commercial activity associated with the new development. This is partly because a ban on the use of the American technology giant smartphones is being discussed in Beijing. Also, the Chinese authorities have stated problems with the security of the iPhone. This statement was made before the presentation of the new generation of the smartphone, but its impact probably turned out to be long-term.
Counterpoint Research data demonstrate that Huawei, based in the city of Shenzhen, located in the south of Guangdong Province, has made a major contribution to the recovery of the Chinese mobile market. This company has released a new series of Mate 60 smartphones. Huawei has attracted universal attention and consumer interest, mostly because a new 5G chip made in China was discovered in these devices. This microcircuit is also equipped with a foldable model Mate X5.
Analyst Archie Zhang called Huawei the clear leader of the Chinese mobile market in October. According to him, the company’s sales growth was impressive due to the powered marketing launch and widespread media attention with a Chinese-made 5G chip. The analyst notes that the demand for Huawei products in the home market is in double digits. Separately, Archie Zhang talked about the halo effect because not only the devices of the Mate 60 model but also other products of the company work well.
China’s mobile industry was in a state of prolonged decline amid an oversupply of products that arose last year due to the Covid Zero quarantine. Contract manufacturers microcircuits Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. believe that the inventory adjustment is coming to an end, which means the recovery of the dynamic of orders and the movement of this indicator towards growth. South Korea, where several chipmakers are based, on Tuesday, November 14, reported the return of export volumes of memory microcircuits to positive values for the first time in 16 months.
Counterpoint Research reports that Chinese smartphone manufacturers are currently striving to meet the sharply increased consumer demand for their products. For example, Xiaomi’s 14th series has received more than a million orders since its launch at the end of October. Against this background, the market value of the Beijing-based company has increased by about $20 billion.
Experts note that the success of Chinese manufacturers may become a problem for Apple. In recent quarters, Tim Cook’s company has received almost 20% of its revenues in the market of this Asian country. Increased competition and consumer preferences in favor of local manufacturers may worsen Apple’s financial performance in this region.
As we have reported earlier, Taiwan to Check Suppliers for Cooperation With Huawei.