China's mobile phone market first shipment decline in 2017 2018 market changes will be more intense
In 2017, mainland China remained the world's largest smartphone market by region. However, it saw a notable decline in shipments, with Canalys reporting a 4% drop from 2016, totaling 459 million units—marking the first time the market had experienced such a decline in its history. The fourth quarter was particularly tough, with shipments falling over 14% year-on-year to just 113 million units, making it the worst performance in that period. As the market grew stagnant and competition intensified, the Chinese smartphone landscape was expected to become even more competitive in 2018.
According to Mo Jia, a research analyst at Canalys, Huawei managed to ship over 24 million smartphones in the last quarter of 2017, which was its best quarter to date. This success was attributed to Huawei’s strategy of expanding into third- and fourth-tier cities. The Nova series and sub-brand Honor played key roles in this growth, with Honor accounting for nearly half of Huawei’s total shipments. However, as the company continues to grow, internal competition between its own brands may become a challenge in the future.
[Image: China's mobile phone market first shipment decline in 2017, 2018 market changes will be more intense]
Looking at the performance of major brands in the fourth quarter of 2017, Huawei shipped approximately 24 million units—a 9% decrease from the previous year. Oppo and Vivo also saw declines, with shipments dropping by 16% and 7%, respectively. Despite this, both companies maintained their positions as second and third in the market, with Oppo shipping around 19 million units and Vivo at 17 million. Apple outperformed Xiaomi in the annual rankings, securing the fourth position, while Xiaomi came in fifth with 13 million units.
Anshul Gupta, a research director at Gartner, noted that Huawei, now the world’s third-largest smartphone vendor by shipments, continued to expand its global market share in 2017. In the fourth quarter, both Huawei and Xiaomi were among the top five global manufacturers and stood out as rare companies that maintained steady growth during a challenging period.
HatTie He, a Canalys research analyst, highlighted that the saturation and slow growth of the mainland Chinese market would pose significant challenges for local manufacturers heavily reliant on domestic sales. These factors could impact not only their cash flow and profitability but also their overseas expansion efforts. Additionally, with Lenovo and ZTE planning to refocus on the Chinese market in 2018, competition was expected to intensify further. Canalys predicted that key players in the mainland market would actively adjust their strategies, leading to more dramatic shifts in the industry throughout the year.
Consumer Electronics
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