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Smartphone recovery in China offers hope to industry

(Image credit: Future)

Smartphone shipments In China rose by 14.2 per cent in April, giving the mobile industry optimism that the market can rebound once lockdown restrictions are lifted and that 5G can deliver the return to growth that was promised before the coronavirus crisis.

As the initial epicentre of Covid-19, China was the first country in the world to impose restrictions on citizen movement and activity in a bid to contain the virus’s spread.

As a major manufacturing hub for the mobile industry, as well as its largest market, this caused significant disruption and contraction.

Chinese smartphone sales

During the first three months of 2020, Chinese smartphone shipments fell by 39.4 per cent to 50 million, with the biggest drop taking place in February, when the market shrank by 56 per cent. Globally, the month of February and the first quarter of 2020 saw the biggest contractions in market history.

The status of lockdown measures differs from country to country, but in China 41.7 million devices were shipped in April alone. There is hope that delayed purchases and the return to normal economic activity will revive sales in other countries too.

Even before the Coronavirus crisis, smartphone manufacturers were struggling with market saturation. After several years of massive growth during the early 2010s, sales slowed in recent years due to a lack of new markets, higher prices and a perceived lack of innovation that led to consumers holding onto handsets for longer.

The arrival of 5G in 2020 was set to kickstart a revival but lockdown measures, coupled with an economic slowdown and possible delays to operator rollouts had dampened expectations. However, the figures in China offer some hope. More than a third (39.3%) of the devices sold in China during April were 5G compatible.