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Production of smartphones could drop 30% in 1H 2020 due to Covid-19

By Cookie Monster - on 25 Mar 2020, 12:00am

Production of smartphones could drop 30% in 1H 2020 due to Covid-19

Sales of the Samsung Galaxy S20 lineup are reportedly affected badly by the Covid-19 outbreak around the world.

Global tech market advisory firm ABI Research just released a bleak forecast for the global smartphone market in the first half of 2020. 

According to its estimates, the production of smartphones could potentially drop as much as 30% in the first half of the year due to the coronavirus outbreak. As China is located at the epicenter of the virus outbreak, production lines and supply chains saw mass disruption caused by manpower shortages and inactive logistics. 

Even though 5G was cited as a major driver for smartphone sales this year, ABI Research believes shipment volumes for 5G smartphones will be much lower than expected due to stagnant supply and crippled demand. This will also affect the launch of Apple's first 5G iPhones in September.

While the Covid-19 situation is likely to be brought under control by end of Q2, ABI Research thinks it will take some time for consumer confidence to return and for the smartphone market to recover. 

This is one of the numerous reports by research firms that paint a negative outlook for the global smartphone market. Strategy Analytics said the global smartphone market saw its biggest fall in shipments last month. IDC estimated smartphone shipments in February to decline more than 50% in China. IDC also shared that global phone shipments would drop 10.6% in the first half of the year.

Source: ABI Research