Smartphone shipments Dive by 38% in the first quarter of 2020. It is important to note that this is the time when Covid-19 pandemic was almost at its peak in China. Which affected the global smartphone supply chain. Though, in what has been the first occurrence in the last 7 years, worldwide smartphone shipments have dropped by a staggering 11.7 percent in the very first quarter of 2020 according Strategy Analytics report.
Different smartphone manufacturers shipped a total of about 275.8 million pieces within the first three months of 2020, in comparison to almost 312.5 million pieces in the last year.
The biggest reason for such a steep contraction in the supply can be credited to the Chinese market, which witnessed a drop of almost 20 percent due to the coronavirus outbreak, and lockdown respectively.
Although, lower demand in China is not the only reason. Many smartphone manufacturers faced numerous supply chain issues as they had tie-ups with Chinese manufacturing units for specific parts of their phones, or had their own facilities set up there. With the COVID-19 lockdown, there was nothing that could lead to phone assembly.
This is where even regions like Western Europe and the United States also played their part during this slowdown, registering a decline in shipments to 18.3 and 16.1 respectively. Just to contrast this, in the app space, things are pretty positive, app stores have registered a sudden spike in the organic mobile app download.
The interesting thing to note here is that while it all began as a problem of supply chain in just China, it has now translated into a global economic problem. While the supply chain problems in China are recovering, now that the COVID-19 situation is under control there, the global lockdown will cause the demand curve to fall flat to a greater extent.
The present shipment numbers are the lowest since the second quarter of the year 2013. It will be important to watch whether this is a temporary blip or this trend is going to stick around for a while.
