Thanks to a new report by Counterpoint Research, we now know that China accounted for nearly half of all global 5G phones shipment sales last year. Chinese technology giant, Huawei (along with sub brand Honor) dominated sales in china, capturing nearly three-fourths of its 5G market.
5G home market
Huawei, whose headquarters are in Shenzhen, has been making its home market a priority for sales after the US banned the company from supplying 5G infrastructure to the US telecom network, in May last year, due to potential national security risks.
The report shows, Huawei and Honor were the only two major 5G phone companies to see shipment sales growth in China throughout 2019. Apple and Xiaomi had significant declines of more than 20 percent each.
Coronavirus effects
Findings showed that the high dependence of Huawei on the Chinese market makes it “most vulnerable” to the effects of the novel coronavirus outbreak on the 5G phone market.
“China handles at least 50% of global smartphone production and the coronavirus outbreak is bound to adversely affect”
Varun Mishra, Counterpoint Research
Varun Mishra, Research Analyst at Counterpoint Research said: “China handles at least 50% of global smartphone production and the coronavirus outbreak is bound to adversely affect China as well as the global smartphone market. There will be disruption from the supply-side with production facilities of smartphones and components either shut down or running below full capacity due to labor shortages."
"The overall demand will also dramatically fall due to disruption in retail. Offline stores will be affected the most. We are estimating sales to drop over 20% in China in Q1 2020. The OEMs which will be affected the most are the ones having production facilities in the Wuhan area like Lenovo and Motorola, and the ones for whom China is the major market like Huawei. OEMs like realme, Honor, and Xiaomi, which are more reliant on online distribution are likely to be least affected compared to those that have a relatively high share of offline sales,” Mishra continued.
19 million 5G phones were shipped in 2019 and, according to Strategy Analytics, this is set increase more than ten-fold to around 199 million this year.
