India's smartphone shipment fall 5% in Q3 due to fragile supply chain: Canalys

Asia's Tech News Daily

india, xiaomi, samsung, mobile shipment, smartphones

Smartphone shipment in the country fell 5 per cent year-on-year in the September 2021 quarter to 47.5 million units as vendors struggled with supply issues for low-end models, according to research firm Canalys.

Notably, the third quarter of 2020 makes for a tough quarter to compare with due to pent-up demand last year, it said.

Shipment in the September 2021 quarter was up 47 per cent from the June 2021 quarter as “consumer demand bounced back rapidly thanks to the suppression of India’s COVID-19 wave”, it added.

Xiaomi maintained its lead, shipping 11.2 million units for a 24 per cent share. Samsung retained the second spot with 9.1 million units, accounting for 19 per cent market share.

Vivo came in third with 8.1 million shipment (17 per cent), followed by Realme with 7.5 million units (16 per cent) and Oppo with 6.2 million (13 per cent), Canalys said.

“Vaccine roll-out has been colossal for the Indian economy. From the end of June, a surge in demand has swept India, which is set to persist during the festive season. Smartphone vendors have seized the opportunity to push the older stock into the channel ahead of the holiday period,” Canalys Analyst Sanyam Chaurasia said.

But low-end model supply constraints mean shipments have been restricted, and brands have been forced to use promotions to make their high-end models more appealing, Chaurasia added.

“These challenges will persist into Q4, and high component and logistics costs, together with container shortages will result in longer lead times and higher retail prices. But smartphone brands are striving to minimise the impact on Indian customers and will prioritise online channels where possible to provide a margin buffer that may allow for less price disruption,” he said.

Canalys Research Analyst Jash Shah said the fight for market share has intensified further in India.

“Smartphone vendors are using a range of strategies, from extending their product mix to boosting their channel coverage, to increase shipments and value,” Shah added. Shah cited the example of Xiaomi that used its Mi 11 series to raise its share in the premium segment, despite a slight drop in share overall.

“Apple, its main competitor for high-end share, used promotional deals to inject momentum into iPhone 12 sales ahead of its iPhone 13 launch in September. But Realme is taking a different tack, hoping to undermine high-end vendors with its focus on affordable 5G. Its shipments were 70 per cent online, and it shipped around 1 million of its Realme 8 5G,” he said.

Competition is unlikely to let up anytime soon, as challenger brands such as Transsion attempt to scale up and disrupt incumbents in India, he added.

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