Global smartphone production could drop by up to 16.5 percent in Q2 2020, according to the latest data forecast by market research firm TrendForce. This drop would mark the largest ever year on year (YOY) decline for a given quarter.
TrendForce reports the global smartphone production to have fallen 10 percent YoY to around 280 million units in the first quarter of this year. This drop was caused by COVID-19-induced disruptions across the supply chain, as most of the factories remained shut for several weeks.
Although production is slowly resuming, the global economy has gone into a recession because of the COVID-19 pandemic. As a result, the demand for smartphones is likely to remain affected in the second quarter as well.
TrendForce predicts the production volume to come in at around 287 million units in Q2 2020, marking a record 16.5 percent YoY decline.
Global smartphone demand hit hard by the COVID-19 pandemic
The COVID-19 pandemic has already started making its effects felt on the smartphone industry. Samsung, the largest smartphone vendor in the world, is struggling to move its Galaxy S20 flagships off the store shelves.
The South Korean company has now scaled down its smartphone production in April. It reportedly made just 10 million units instead of the monthly average of 25 million units. The company is also reducing order for components by up to 50 percent across the board.
According to the data forecast by TrendForce, Samsung manufactured 65.3 million smartphone units in Q1 2020. The numbers are expected to drop further to 58.3 million units in the second quarter, as the company’s smartphone assembly lines in India have remained shut since late March due to the imposition of a national lockdown.
Apple has also fallen victim to the influence of the COVID-19 pandemic in Europe and the US. The company’s iPhone production fell 8.7 percent to about 38 million units in the first quarter. TrendForce expects a further drop of 2 million units in the second one.
Apple has slashed prices of its iPhone 11 in China in order to boost sales. It also recently launched a $399 iPhone SE.
Huawei, the second-largest smartphone vendor globally, on the other hand, is likely to have a better second quarter than the first. China has weathered the COVID-19 storm and demand for smartphones has started to recover.
Since China is Huawei’s main market, it may see a surge in sales this quarter. TrendForce expects the company’s smartphone production to come in at approximately 48 million smartphone units in Q2 2020. It made 46 million units in the first quarter.
Other Chinese OEMs, such as OPPO, Vivo, and Xiaomi are also likely to see some improvements this quarter. However, the smartphone market would still find it difficult to recover fully this year. Overall, TrendForce forecasts a total yearly production volume of 1.24 billion units this year, down 11.3 percent from 2019.