Domestic mobile phone brands collectively lowered their shipment targets, with Honor and OnePlus cutting shipments by 40%

According to industry insiders, Chinese mobile phone brands including Xiaomi, Oppo, Realme and Honor have lowered their 2021 shipment targets in early May.

The Electronic Times quoted the above-mentioned person as saying that Xiaomi will adjust its full-year shipment target for 2021 from 240 million units to less than 190 million units, Oppo and its affiliated brand Realme will drop from the previous 170 million units to 130 million units, and Realme alone will cut its shipments this year from 85 million units to 60 million units.

OnePlus' shipment target will be reduced by 12 million units from 20 million units, while Honor will reduce its target from 50 million units to 30 million units. Both companies' reductions are as much as 40%.

Sources pointed out that Xiaomi, Oppo and Realme revised their shipment targets for the second time in just a few weeks, reflecting that the three suppliers' forecasts for business prospects in India are quite pessimistic due to the decline in demand in the Indian market due to the surge in confirmed cases of the new coronavirus.

Except for some mid- to high-end models, new 5G smartphones launched by most Chinese brands in the domestic market have not boosted sales momentum as expected. The sources added that 5G phones have failed to stimulate sales due to a lack of innovative applications.

According to Taiwan's Economic Daily News on the same day, in addition to the above-mentioned mobile phone manufacturers, Vivo's shipments were also revised down from the original estimate of 180 million units to 150 million to 160 million units. As for Samsung, the industry also reported that its full-year mobile phone shipments may be revised down.

According to Canalys data, Samsung, Xiaomi, OPPO, and vivo are the top four non-Apple brands in the world. In terms of global market share, these four brands rank second to fifth, with a combined market share of nearly 50%. These four major manufacturers have started a new wave of order cuts, which the industry believes is "no small matter."

It should be pointed out that the above news has not been confirmed by the brands, and downstream component manufacturers have also stated that they have not encountered a significant reduction in orders from mobile phone brands. On the contrary, the supply of related IC components used in mobile phone production is still tight, and most factories are still operating at high capacity.

According to a previous report by Electronic Times, some market observers pointed out that Apple will start to secure component orders for the new iPhone planned to be launched in the second half of this year in the third quarter. Therefore, even if some brands start to cut orders, the order gap can be filled.

In the long run, the above observers believe that as 5G infrastructure becomes more popular, sales of 5G mobile phones will also gain momentum.

However, there are also rumors in the industry that the inventory levels of components of Xiaomi and OPPO seem to be too high, which has attracted great attention from chip manufacturers. They are currently checking the supply chain situation to decide whether to reduce their inventory preparations on their own.

An article in the Economic Daily stated that although mobile phone manufacturers have not yet cut orders to major chip manufacturers, they have adjusted their order volumes to some peripheral component manufacturers that are less in short supply, with orders this quarter cut by approximately 10% to 30% compared to the previous quarter.