These are testing times indeed and even before the Covid-19 pandemic forced the world to shut down, the smartphone industry was facing a lull. In countries like India, retail stores are shut and with e-commerce sites only selling essential services, the downswing is set to have a massive bearing on the entire industry.
As per Counterpoint Research, the second quarter will reflect a slight rebound but there will be slight positives throughout the balance of 2020 in China.
Now, this picture might not be as positive in India where lockdowns were enforced in March.
“It may be as deep as China’s sharp slowdown but will likely last longer. Unlike China, where at least a part of the slowdown was supply-driven, the rest of world’s contraction is driven more by consumers withholding replacement activity until they get more comfortable with the new economic realities of their situation,” said Peter Richardson, Research Director, Counterpoint.
The smartphone production is slated to dip by nearly 30 per cent for the month of March amid lockdown as all the smartphone manufacturing units will be shut down nationwide.
Richardson also added that the recovery should be strong once the lockdown eases but then there will be changes to the way consumers spend their resources.
The world is officially in a global recession according to the declaration made by the International Monetary Fund (IMF). As per the estimate, IMF chief Kristalina Georgieva has said that the global growth will turn sharply negative in 2020 and as many as 170 countries will experience negative per capita income growth in 2020.
“In India, the government acted with great speed to lock down the country. But in so doing, it seemed to forget the millions of migrant and casual labourers that make up a large percentage of the workforce. Many found themselves not only jobless but also homeless – more or less overnight,” said Richardson.