The Chinese smartphone market in great difficulty, records a sharp drop in demand

The rapid drop in demand, both domestically and internationally, signals the end of China’s smartphone market bubble. According to the latest data, smartphone shipments in China in the second quarter fell 14.7%, marking the fifth consecutive quarterly loss, according to the Financial Post, a US website.

India is currently the second largest mobile market in the world, and it will soon overtake China as the largest market for smartphones. However, Chinese companies predominate in the Indian smartphone sector.

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Indian smartphone makers have been struggling since companies like Xiaomi and Oppo flooded the market with cheap Android devices. According to the Financial Post, India wants to prevent Chinese smartphone makers from selling products below 12,000 rupees in order to revive its sagging local market.

Analysts believe that the Chinese market is in big trouble and things will only get worse due to various causes. According to a Bloomberg report from earlier this week, the Indian government intends to ban Chinese phones that are priced below 12,000 nationwide.

According to the Financial Post, the move aims to force Chinese telecom giants out of the lower price range of the second-largest mobile market.

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Several Chinese smartphone makers have been investigated by the Indian government in recent months over allegations of money laundering and the transfer of income and funds from India to Chinese offices in an effort to avoid pay taxes and levies.

IDC, a US research firm, said smartphone shipments in China fell 14.7% in the second quarter compared to the same period last year, reaching 67.2 million devices.

With big companies like Xiaomi, Vivo and Oppo reporting steep sales declines, this was the fifth consecutive quarter of declining shipments and the second consecutive quarter of double-digit declines.

According to reports, several factors contributed to the decline. The first factor is attributable to the sharp drop in demand caused by the strict “Zero COVID Policy”. The severe restrictions imposed by COVID-19 in China are not good for all businesses. Lockdowns have disrupted retail, logistics and manufacturing.

In the context of economic downturn, the need to replace mobile phones has decreased significantly, and the life cycle of smartphones has become longer and longer.

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But the biggest problem, however, is that the Chinese smartphone market is severely saturated, which could spell the end of China’s smartphone boom of more than 10 years, the Financial Post reported.

At the end of last year, there were more than 1.6 billion active mobile phone accounts in China, surpassing the population of 1.4 billion. The penetration rate is much higher than the global average, leading to intense competition between brands.

Data analytics firm, Canalys, predicted in late July that mobile phone shipments in China this year are expected to be well below 300 million units, the lowest record in nearly 10 years, the Financial reported. Post.

(With ANI inputs)

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