COVID-19 Pandemic Impact: Production of Smartphones Will Fall as Much as 30% in the First Half of 2020

COVID-19 Pandemic Impact: Production of Smartphones Will Fall as Much as 30% in the First Half of 2020

PR Newswire

OYSTER BAY, New York, March 24, 2020

ABI Research whitepaper identifies the short-and long-term impacts the global pandemic will have on 5G devices, smartphones & wearables

OYSTER BAY, New York, March 24, 2020 /PRNewswire/ -- The Coronavirus outbreak is expected to lead to a huge reduction in the production of smartphones, potentially falling by as much as 30% in the first half of 2020, states global tech market advisory firm, ABI Research.

ABI Research www.abiresearch.com

"The ripples from China will be felt globally," says David McQueen, 5G Devices Research Director at ABI Research. With China located at the epicenter of the COVID-19 outbreak, the resultant impact has been disastrous for the global mobile device market, which has subsequently witnessed mass disruption to its production lines and a stalling of related supply chains caused by labor shortages and inactive logistics. As China is also the world's manufacturing center for most of these device types, and one of its biggest markets, the sector has been hit hardest by delayed shipments and a weakened development of next-generation products.

"Significantly, in the short term, there will be an adverse effect on 5G devices. No sooner had 5G smartphones started to gain some traction and break into the market in significant numbers, than the outbreak will now trigger a suppression of its near-term growth, pushing out the development and introduction of affordable 5G phones," McQueen explains. This move to lower price tiers was expected to become a key driver for boosting 5G smartphone shipments in 2020, but the desired impact will now be lessened throughout the year due to the outbreak. Shipment volumes for 5G smartphones in 2020 will be much lower than previously expected, slowed by a stagnant supply chain and crippled demand. "Undoubtedly, the market will also be faced with numerous disruptions and delays, most notably the launch of Apple's first 5G iPhones that are due to appear in September 2020."

In the longer term, expectations are that the outbreak will gradually come under control by end of 2Q 2020, but it will take some time thereafter for consumer confidence to return and for the device sector to recover. "Importantly, with such a large proportion of the world's mobile device market relying on China for manufacturing and component supply, which is contending with disruption on a massive scale, it has become clear that many in the chain were woefully unprepared to react quickly," McQueen points out.

It is not clear what the full extent or lasting effect that COVID-19 will have on the mobile device ecosystem, but in the short- to medium-term, it will heavily impact the smartphone market. "Aside from taking its toll on both demand and the supply chain, it will particularly affect the industry's eagerness to drive 5G to lower price points in 2020, seriously blunting its growth potential," says McQueen.

McQueen recommends that "vendors and suppliers fully understand their exposure to all those along the chain, identifying and evaluating all risks related to issues like capacity management and market demand, enabling them to react accordingly and mitigate the impact of any future market disruptions."

For a clearer picture of the current and future ramifications of COVID-19 across technologies and verticals, including  5G devices, Smartphones, and Wearables, download the whitepaper Taking Stock of COVID-19: The Short- and Long-Term Ramifications on Technology and End Markets.

About ABI Research 
ABI Research provides strategic guidance to visionaries, delivering actionable intelligence on the transformative technologies that are dramatically reshaping industries, economies, and workforces across the world. ABI Research's global team of analysts publish groundbreaking studies often years ahead of other technology advisory firms, empowering our clients to stay ahead of their markets and their competitors. 

ABI Research提供开创性的研究和战略指导,帮助客户了解日新月异的技术。 自1990年以来,我们已与全球数百个领先的技术品牌,尖端公司,具有远见的政府机构以及创新的贸易团体建立了合作关系。 我们帮助客户创造真实的业务成果。 

For more information about ABI Research's services, contact us at +1.516.624.2500 in the Americas, +44.203.326.0140 in Europe, +65.6592.0290 in Asia-Pacific or visit www.abiresearch.com.

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Global                                                             
Deborah Petrara                                                           
Tel: +1.516.624.2558                                                    
pr@abiresearch.com
  

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