Previous Apple Quarterly Reporting Conference timid optimism of the iPhone manufacturer about the dynamics of demand for these smartphones in the Chinese market. By the way, in this country, the American company receives about 18% of net revenue, so it cannot ignore the interests of Chinese consumers without compromising its own income. The realization of this fact, by the way, allowed Apple to reduce the price of smartphones in China in an attempt to partially compensate for the weakening of the national currency against the US dollar. The Chinese authorities simultaneously reduced the VAT rate, and Apple launched branded programs for exchanging old smartphones for new ones and buying iPhones in installments. All these measures allowed Chinese demand for the iPhone to return to growth last quarter. In early May, Apple management also mentioned the then emerging stabilization of relations between the United States and China in the field of foreign trade as one of the factors favorably influencing domestic demand.
In less than a few weeks, relations between the United States and China, amid tariff negotiations and the persecution of Huawei by the American authorities, deteriorated sharply. A victim of this confrontation, according to analysts , may become the entire global smartphone market, and separately - and Chinese. According to their estimates, this year no more than 1,36 billion smartphones will be sold worldwide, which is not only 2,8% less than last year, but also corresponds to the lowest value since 2014. The smartphone market in 2020 will grow to 1,38 billion units, and to 1,41 billion in 2021, but the average selling price of these devices will decrease by 5% annually in the next two years.
Users are already eager to keep their smartphones for longer than in years past, and the situation is only getting worse with the persecution of Huawei, the conflict between the US and China, and the proximity of the transition to 5G networks. Flagship devices will switch to 5G networks this year for the Android platform, and next year for the iPhone. Apple's current-generation family of smartphones doesn't really impress buyers with its capabilities. Moreover, Citigroup experts do not believe that Huawei's problems in the smartphone segment will allow Apple to snatch its market share at least in some part. Confused Huawei customers will be picked up by other manufacturers of Android smartphones, primarily by Samsung, which can draw up to 40% of "refugees" to itself.
In general, according to analysts, outside of China, Huawei will lose up to 80% of its positions in the smartphone market, and the total sales of all smartphones from all manufacturers in the world will fall by 15 million units only because of this factor. In other words, other manufacturers will not be able to fully make up for the sales volumes of smartphones that have dropped out due to Huawei's problems.
Apple will suffer from another weakening of the Chinese currency, which it tried to fight by lowering the price of the iPhone in this country. Attacks on Huawei by the United States, together with the effect of the weakening of the yuan, according to representatives of Citigroup, will cause a decrease in iPhone sales in China by 9% by the end of the year. Some Chinese buyers will simply boycott the products of the American brand solely out of solidarity with Huawei. Over the next two years, the capacity of the Chinese smartphone market will also decrease, but at a more moderate pace.
The confrontation between the US and China will not add economic stability on a global scale either. The currencies of countries with growing economies will weaken, which will negatively affect the purchasing power of potential owners of new smartphones. Finally, Huawei is a major player in the telecommunications sector, which determines the pace of development of 5G networks, and if the problems of the Chinese company affect contracts with telecom operators, then the demand for flagship smartphones with support for 5G networks will not grow either.
Source: 3dnews.ru