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Smartphone production volume to remain flat in quarter four

According to TrendForce’s ( latest report on this year’s smartphone production, the total volume for the third quarter of 2018 [3Q18] grew by 8% from 2Q18 to around 380 million. 

The research group says the growth was attributed to a gradual recovery of demand in 2Q18 and the stock-up of inventories related to releases of new devices and holiday sales events. Although the latest products from Apple and Huawei continue to generate demand in the smartphone market, the sales of new iPhone Xr/Xs/Xs Max turned out to fall short of expectation, resulting in lower shipments of iPhones, claims TrendForce. Therefore, DRAMeXchange estimates that the total production volume for 4Q18 will be roughly similar to that of 3Q18, coming to around 380 million units.

TrendForce says that, since the general development of the smartphone market has reached the mature stage, and smartphone brands are struggling to differentiate their new products, many of which lack breakthrough features to stimulate purchases. Thus, consumers are less active than before with respect to replacing their existing devices. 

Apple’s iPhone devices for this year again intended to push the upper limit of the acceptable price range for high-end smartphones, according to TrendForce. The research group opines that consumers appear to be less willing to pay for the two new AMOLED models – iPhone Xs and Xs Max, which are priced too high to be accepted. 

The economically priced LCD model, iPhone Xr, may take over as the sales driver, but the ramp-up of its production had been scheduled to take place in 4Q18. Furthermore, factors such as the US-China trade dispute and the appreciation of the U.S. dollar have been constraining iPhone sales outside the U.S. Consequently, iPhone XR did not contribute significantly to the iPhone production in 3Q18, claims TrendForce.

Looking ahead, Apple can further lower the prices of its older iPhone models to spur sales, the research group predicts. Also, 4Q18 is expected to be the year’s peak iPhone production period, as Apple has scheduled the ramp-up of its latest models during this time. Thus, the total iPhone production volume in 4Q18 is estimated to reach around 76 million units, which would allow Apple to surpass Huawei and compete with Samsung for the top position in the ranking.

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