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Last Updated : Jul 13, 2020 09:11 AM IST | Source: Moneycontrol.com

Smartphones sales in July slump 30-40% as import hurdles for China affect unit production

Shipments have been delayed at airports and ports after the Centre imposed 100 percent manual checks on Chinese imports citing security concerns

Representative Image (Reuters)
Representative Image (Reuters)

Smartphone sales in July slumped by 30-40 percent week-on-week, due to the supply hold-up of imported components from China, which pushed down unit productions in the month.

Sales numbers across all brands and devices from offline and online platforms fell as store stock of smartphones dwindled, market trackers International Data Corporation and Counterpoint Research said.

This ‘rollover’ impact of Customs clearance delays which started in June is likely to continue through July as well; and a leading agency has downward marked its original estimation of 16 million units for April-June shipments, The Economic Times reported.

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For smartphone makers in India, the devices are usually assembled locally, with parts and components shipped in. The process from shipping, to assembly and distribution takes close to a month on average, with local COVID-19 lockdowns sometimes also affecting timelines, Neil Shah, research director at Counterpoint told the paper.

The checks are still in place – with a few exceptions. Supply will thus continue to be hampered, “especially for China-based vendors, and factories still running at less than half the capacity. The situation will take longer to improve than expected earlier, with supply bottlenecks clubbed with anti-Chinese sentiments,” said Upasana Joshi, associate research manager at IDC, India told ET.

It is not however only the Chinese brands suffering delays. Local players have also been impacted. South India’s Sangeetha Mobiles which saw businesses in May-June jump 90 percent after lockdown eased and also recorded a 40 percent sales slump in July.

Chandu Reddy, the director of Sangeetha Mobiles, said pent up demand is tapering off and the supply situation – which was in choppy waters after coronavirus pandemic pushed back imports is similar now.

Shipments have been delayed at airports and ports creating an at least 10-day backlog as the Centre imposed a 100 percent manual check on Chinese imports citing security concerns. The move came after Indian and Chinese troops clashed in Galwan Valley, Ladakh near the Line of Actual Control (LAC) in June.
First Published on Jul 13, 2020 09:11 am
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