Xiaomi, Realme, Apple’s Supply Disrupted Due To Coronavirus; Realme, Xiaomi Cancels Launch Events
The coronavirus is causing havoc not only in China but all around the globe.
The contagious Chinese virus is spreading rapidly and not only affecting the health but also the Indian business and markets .
Lately, Chinese smartphone manufacturer’s Xiaomi, OPPO and Qualcomm, the leading mobile chipset maker in the world, said that the coronavirus epidemic poses a potential threat to the global smartphone industry in terms of new launches, product shipments and production.
Xiaomi, Realme, and TCL are a few of the local manufacturers that have been hit but Apple is reported to be one of the worst affected.
iaomi, Realme, and TCL are a few of the local manufacturers that have been hit but Apple is reported to be one of the worst affected.
Read to find out more about the coronavirus impact on the smartphone industry…
Xiaomi, TCL, Qualcomm, Oppo and Many More Face Stock Crunch!
The reason for stock crunch being that most companies are dependent on China-based manufacturers for parts and components required for assembly.
Xiaomi and TCL have been facing a significant shortage in supply for their respective TV models. Since Xiaomi is not limited to any one electronic product, it is also facing issues in its other departments as well including the air conditioning department. Xiaomi is postponing its entry into air-conditioners by a few weeks.
In a conference call with investors, Qualcomm chief financial officer Akash Palkhiwala said that the company expects significant uncertainty around the impact from the coronavirus on handset demand and supply chain. He also significantly said that coronavirus is also going to impact the manufacturing and sales of smartphones.
While the company is facing shortage in the supply of new chipsets, it has also left options open. During the call, Qualcomm CEO Steve Mollenkopf said that if the company faces a supply chain issue or demand issue in China, then it has the ability to move to other regions to back it up. Mollenkopf was quoted as saying by MoneyControl, “We want to make sure that we maintain that strength across different markets.”
OPPO is also running short of devices in India because of the China factory shutdown. However, Oppo India president Elvis Zhou believes that the coronavirus disruption will end in a week or two. Zhou told ET that the company is investing INR 3500 Cr for setting up a manufacturing facility in Noida, India. The Noida-based manufacturing plant will help the company to ramp up the production of smartphones and IoT products.
OPPO is planning to start exporting products from this facility in Noida. OPPO’s parent company BBK Electronics also owns smartphone brands OnePlus, Vivo, Realme and iQoo. However, with China’s manufacturing plants on the shutdown, these brands are facing a supply shortage.
Apple in Crisis!
Apple was observing higher than normal sales of its latest iPhone 11 and Apple Watch series, but the viral outbreak has led to the downfall in supply chain. Supplies of the locally manufactured iPhone XR and 7 are not impacted, as the company manufactures them in India with its partners.
Retailers said discounts on products have been put off and some products such as iPhones, MacBook computers and Apple Watches are now sold at the sticker price in offline stores.
The senior executive of an Apple exclusive store chain said distributors have indicated supplies will normalise only by April since most production is being routed to the US and Europe. In addition he said, “Business is down by 50% last week and March is looking bleak.”
Realme Cancels Realme 6 Series Launch Event!
To dodge the coronavirus impact, the companies are not only cancelling the launch event but also finding other ways to launch their products
Realme on March 3 announced it is calling off the Realme 6 series launch event in New Delhi over the scare of the Coronavirus epidemic. Real me was going to launch its Realme 6 and Realme 6 Pro along with its first fitness wearable, The Realme Band.
The company is planning on making announcements via an online stream, which will be hosted by Realme India CEO Madhav Sheth.
Realme is also currently facing troubles with supply after its latest handset models like the Realme C3 and 5i’s production being affected.
Xiaomi Also Cancels Redmi Note 9 Launch Event!
Xiaomi India had scheduled a launch event for an upcoming smartphone, Redmi Note 9 on March 12, 2020. However, with the risk of coronavirus spreading at the event, the company called it off, and replaced it with an online launch. Xiaomi isn’t still able to meet the demand due to stock crunch.
Xiaomi India head Manu Kumar Jain, took to Twitter saying, “This is keeping in mind the safety of fans, media friends, employees and partners. I urge you all to stay safe.”
Samsung Breathing a Sigh of Relief!
Samsung has recently shifted its manufacturing and assembling bases to other countries such as Vietnam and India. Hence the impact of the China shutdown hasn’t been very severe on the company.
Retailers Hoarding Products!
As of right now, most of the aforementioned brands have restarted production again in China. Although their functioning capacity is very slow paced and is still around 35-50%.
Additionally, some of the components during this period have also gone up in price, causing Original Equipment Manufacturers (OEM) to either absorb or hike prices of their products as well.
The problem is more widespread than previously thought. Both online and offline retailers are hoarding products such as air conditioners, imported TVs, washing machines and refrigerators fearing further disruption in the supply chain.
Retailers are building up inventory anticipating short-term supply constraints, said Pulkit Baid, director at Great Eastern Retail, a leading chain in the east and the north.
Vishal Mewani, director of Mumbai’s leading chain Kohinoor Electronics, said, “We are getting 10-20% of the required quantity.”