Coronavirus and smartphone market, what will be the consequences?

After Apple has already warned investors about the possible negative consequences of the coronavirus epidemic in China, a new report published by Trendforce sheds light on what is happening and could happen in the future.The entire smartphone market.

coronavirus smartphone

Trendforce states that the production of smartphones will be particularly affected in recent months, because much of the assembly of the devices and the necessary labor are in China. It is expected that smartphone production in the first quarter of 2020 will decline by 12% on an annual basis, making it the quarter with the lowest production in the past five years.

The problem does not only concern the assembly of the devices, but also the realization of the components necessary for the production of smartphones. Even if we wanted to differentiate the final assembly part by moving production to India or other countries, the problem of supplying these components would remain. Also wearable devices, like AirPods and Apple Watch, are expected to experience a 16% drop from initial estimates.

Trendforce expects that iPhone shipments worldwide they will drop 10% in the first quarter of 2020, while Samsung will experience a much lower drop of 3%. Just Samsung could be among the smartphone manufacturers to benefit most from this situation, given that for several years it has started production of half of its smartphones in Vietnam. With Apple and other Android manufacturers struggling with the situation in China, Samsung could therefore gain new customers by limiting the damage resulting from the coronavirus.

Furthermore, Samsung will be less affected than Apple also because the sales of its smartphones in China are very low.

What do you think?

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