TrendForce: Global Smartphone Production May Suffer Record Decline in Q2 2020

[MacRumors]

Global smartphone production could see a record fall of up to 16.5 percent in the second quarter of this year, according to the latest research by TrendForce.

Global production for 2Q20 is now estimated to register another YoY drop of 16.5% to 287 million units, the largest decline on record for a given quarter. TrendForce forecasts total yearly production volume of 1.24 billion units, an 11.3% decrease YoY.

Worldwide smartphone production for the first quarter reportedly fell by 10 percent year on year to around 280 million units, the lowest in five years, due to disruptions across the supply chain caused by the global health crisis.

Prior to the crisis, TrendForce had expected Apple to once again reach yearly production of 200 million units, owing to the release of the new iPhone SE, four new models in the fall, and the phasing out of the popular iPhone 6s series by the seasonal smartphone replacement cycle.

However, iPhone production fell by 8.7 percent year on year in the first quarter, reaching 37.9 million units, due to labor and material shortages following the post-Lunar New Year work resumption, which saw Apple ranked in third place in the global market.

Apple's recent launch of the low-priced iPhone SE is expected to see it stay relatively close to 1Q 2020 figures, reaching 36 million units. The higher price of Apple's next-generation flagship iPhones is said to be an ongoing concern, however, given that Apple's main smartphone sales are in Europe and the U.S., both of which are still grappling with the health crisis.

Apple is expected to offer four flagship iPhones in three different sizes later this year: A 5.4-inch ??iPhone??, a 6.7-inch ??iPhone??, and two 6.1-inch iPhones. One 6.1-inch model and the 6.7-inch model will be higher-end iPhones, while the other 6.1-inch ??iPhone?? and the 5.4-inch ??iPhone?? will be lower-end models and successors to the ?iPhone 11?. Apple is expected to launch the new models in the fall.

Article Link: TrendForce: Global Smartphone Production May Suffer Record Decline in Q2 2020

 

[Wanted797]

Well... I’ll be damned.

 

[PBG4 Dude]

I believe you mean 36 million units, not “36 million figures”.

You guys should add a “report a typo” link to your articles like other sites do.

 

[CarpalMac]

May? I'll go wild and predict "Will".

 

[filmbuff]

2020 the year of record breaking! Record unemployment! Record decline!

 

[44267547]

This is just a ‘filler’ article of something that we already know about.

But I’d go to say that it’s not just the ‘smart phone’ industry, the tech industry in general will suffer. These are all superfluous items that are not a necessity in terms of what somebody needs v.s. wants.

 

[CarpalMac]

This is just a ‘filler’ article of something that we already know about.

But I’d go to say that it’s not just the ‘smart phone’ industry, the tech industry in general will suffer. These are all superfluous
items that are not a necessity in terms of what somebody needs v.s. wants.

I really don't move in big circles, yet I personally know of over 20 people who have lost their jobs. Not furloughed, they are actually unemployed. We are in the relative calm before another storm...

 

[jayducharme]

But doesn't this prediction come around every year? Granted we're in the middle of a pandemic and there's record unemployment right now, but people will be staying home and will want to stay connected. Depending on the features of the upcoming iPhones, and how they're marketed, I could see many people getting them (especially with the push to 5G).

 

[Gutwrench]

Color me shocked. Shocked, I say.

 

[gnasher729]

But doesn't this prediction come around every year? Granted we're in the middle of a pandemic and there's record unemployment right now, but people will be staying home and will want to stay connected. Depending on the features of the upcoming iPhones, and how they're marketed, I could see many people getting them (especially with the push to 5G).

Usually when people get unemployed they spend nothing that doesn't have to be spent. So the ones that buy an iPhone are the ones whose phone got stolen or damaged or stopped working. If I don't know when the next pay cheque comes, an old iPhone 6 works just fine.

 

[Romeo_Nightfall]

Still too much waste like the new SE is produced by Apple. They are declining too slowly.

 

[ksec]

This is going to have a much larger impact not on the Phones manufacturers, but the component manufacturers. Especially to commodity parts like DRAM and NAND. We already witness what happed to NAND with a 5% smartphone volume decline.

Hopefully we will see new historic low on NAND and DRAM in the months to come.

 

[SactoGuy18]

I think Android phonemakers are going to suffer because people are realizing the relatively limited updates they get on most Android phones outside of the Google Pixel phones and the phones running Android One. A reason why people buy iPhones is the fact they can get iOS updates for up to five years after purchase of the phone; indeed, my iPhone X could easily continue to get iOS updates to 2022.

 

[gsmornot]

I think part of the decline is the lack of social interaction. When you don't see on a regular basis someone else with something you might want, you shop less. Not everyone but many I assume are influenced by seeing others they know with things they did not know they wanted yet. With all the space between, it will slow sales of certain items. Lack of funds from not working could be part of it too but people find a way if its something they really want to have.
[automerge]1588250035[/automerge]

I believe you mean 36 million units, not “36 million figures”.

You guys should add a “report a typo” link to your articles like other sites do.

Reply direct to the article or report it via the button on the bottom left. They normally see your direct response to one of those. I have provided several corrections over the years with those methods.You're an OG here and already know, but I agree there could be a button.

 

[JonKelley]

I expect Apple to lean on customer financing tweaks to meet its goal of raising prices on customers this year. If it raised the base iPhone 12 price $100 over the 11, but added an extra year of free financing (easy to do right now with cheap money), that works out to ~$22 a month for 36 months. Sadly, many consumers don't see price, they see payments.

 

[Dwalls90]

Usually when people get unemployed they spend nothing that doesn't have to be spent. So the ones that buy an iPhone are the ones whose phone got stolen or damaged or stopped working. If I don't know when the next pay cheque comes, an old iPhone 6 works just fine.

Couldn't agree more.

An iPhone can easily last 4-5 years (and is fully supported as long by Apple), so unless someone's phone is on its last legs, folks that are unemployed and are struggling to put food on the table for themselves and their family aren't considering buying the latest smartphone tech.

The recession is barely upon us yet. We've only seen the tip of the iceberg of the amount of folks that will be furloughed, unemployed, or working with a reduced salary. As that situation continues to worsen, the % of the population impacted negatively economically from COVID-19 will dwarf any % reduction of smartphone production.

 

[Mr. Dee]

I think Android phonemakers are going to suffer because people are realizing the relatively limited updates they get on most Android phones outside of the Google Pixel phones and the phones running Android One. A reason why people buy iPhones is the fact they can get iOS updates for up to five years after purchase of the phone; indeed, my iPhone X could easily continue to get iOS updates to 2022.

I agree, I have a X too, bought it full price in March 2018. It’s the perfect phone to weather this economic storm since Apple will still be offering new versions of iOS even up to 2023. The A11 Bionic is not your run of the mill here. If they can still support a 5s for so long, I am sure device with 4 cores, could likely get a max of 8 years support.

 

[SgtPepper12]

But doesn't this prediction come around every year? Granted we're in the middle of a pandemic and there's record unemployment right now, but people will be staying home and will want to stay connected. Depending on the features of the upcoming iPhones, and how they're marketed, I could see many people getting them (especially with the push to 5G).

Oh please. You wanna stay connected with people? Use literally any computer-like device with some camera produced in the last 10 years and you are good to go.

I think Android phonemakers are going to suffer because people are realizing the relatively limited updates they get on most Android phones outside of the Google Pixel phones and the phones running Android One. A reason why people buy iPhones is the fact they can get iOS updates for up to five years after purchase of the phone; indeed, my iPhone X could easily continue to get iOS updates to 2022.

Honestly, maybe for committed tech nerds that is a major reason, but most normal people don't care or are even aware of that at all. The reason why people use iPhones over Android phones has little to do with rational considerations and everything to do with psychology and social dynamics (or why people prefer any one of many effectively equivalent options for that matter. Let's call it spontaneous symmetry breaking)

 

[Weaselboy]

I believe you mean 36 million units, not “36 million figures”.

You guys should add a “report a typo” link to your articles like other sites do.

Thanks... I've passed this along to the editors.

If you see mistakes like this, you can just hit the report button to let the mods know.

 

[MoreRumors?]

If demands does indeed go down, I hope to see good deals for the consumers. I have a feeling Apple would be offering higher trade-in value to entice people to trade and buy new phones.

 

[Zwhaler]

Good. Bring on the $649 iPhone 5.4". It's about time smartphone prices come down and the premium flagships become even more premium for the $1,000+. iPhone SE is a good indicator of where the market ought to be heading with regard to sensible prices.

 

[gsurf123]

I commend the rocket scientist who came up with this conclusion.