Huawei dragged China’s smartphone market down in 2020
- Huawei’s sell-in shipments shrunk by nearly half, despite the huge demand for its devices
- Oppo, Vivo, and Xiaomi are fighting to win over Huawei’s offline channel partners across the country — 2021 will be clearly a year of aggressive expansion for these three
- Honor is also a player we shouldn’t ignore in China in 2021
The smartphone market in China declined 11% to arrive at just over 330 million units sold, as market recovery was stalled by the rapid deterioration of Huawei’s performance as a result of US sanctions.
No doubt, the 2020 smartphone market rankings in China released by research-based firm Canalys, shows that Huawei along with Honor led the market followed by other major OEMs, like Oppo, Vivo, Xiaomi, and Apple.
However, it is Huawei too that pushed the overall smartphone market down in China. In fact, the smartphone market in Mainland China finished 2020 with 84 million units shipped in Q4 2020, declining 4% year-on-year (YoY).
In the final quarter of the year, Huawei (including Honor) managed to ship 18.8 million units, and its market share declined to 22% from 41% in the third quarter of 2020. Oppo rose rapidly into second place, shipping 17.2 million smartphones, growing 23% YoY. Vivo also showed strong YoY growth at 20% and came in third at 15.7 million units.
Apple on the other hand reported its best performance in China in recent years, shipping more than 15.3 million units in the final three months of last year, with 18% market share, up from 15% a year ago. Xiaomi completed the top five, shipping 12.2 million units, growing 52% year-on-year.
Huawei’s loss is other players’ gain
As Huawei recedes, consumers and channels in China are exposed to more choices, while newer or smaller brands have more chances to stand out. The market will be ready to embrace a long period of shakeup in the coming year.
Canalys VP of mobility Nicole Peng said it is possibly Huawei’s toughest time as it is restrained to even serve its home market. “Huawei’s sell-in shipments shrunk by nearly half sequentially, despite the huge demand for Huawei devices, as the vendor is unable to fulfill this demand in the foreseeable future. Other vendors are eyeing this opportunity.”
Peng said Oppo, Vivo, and Xiaomi are fighting to win over Huawei’s offline channel partners across the country, including small rural ones, backed by huge investments in store expansion and marketing support.
“These commitments brought immediate results, and market share improved within mere months. 2021 will be clearly a year of aggressive expansion for Oppo, Vivo, and Xiaomi.”
As 5G becomes a common feature for new smartphones, leading vendors like Oppo, Vivo, and Xiaomi will double down investments in their flagship and premium portfolios focusing on product breadth and premium components.
“Apple had a great year in China, where full-year shipments finally returned to the 2018 level, driven by both iPhone 11 and iPhone 12 models. Apple recorded its highest quarterly shipments in China since Q4 2015 when iPhone 6S was launched,” said Canalys Research Analyst Amber Liu said.
Notably, Apple’s launch of the iPhone 12 series in China coincides with Huawei’s struggle, its only rival in the high-end segment, whose flagship Mate series shipped fewer than 4 million units in Q4. However, Apple has not relaxed its market promotions for iPhone 12.
“Aggressive online promotions across e-commerce players, coupled with widely available trade-in plans and interest-free installments with major banks, drove Apple to its stellar performance,” added Liu.
Peng emphasized that Honor is a player we shouldn’t ignore in China in 2021, as the vendor has inherited most of Huawei’s strengths and aims to win over Huawei’s loyal customers.