Supply chain issues catch up with APAC smartphone market

Supply chain issues catch up with APAC smartphone market

Device shipments in the region declined by 11.6 per cent.

Credit: Dreamstime

Ongoing supply chain issues and global chip shortages have caught up with the smartphone market during the third quarter of 2021, with much of the local region facing device shipment declines.

Asia Pacific (APAC), excluding Japan and China, saw device shipments decline by 11.6 per cent, year-on-year, making it the region with the second-largest decline during the quarter, according to analyst firm IDC.

In first place was Central and Eastern Europe, which fell by 23.2 per cent. Globally, shipments dropped 6.7 per cent — twice as large as the anticipated forecast decline of 2.9 per cent.

“The supply chain and component shortage issues have finally caught up to the smartphone market, which until now seemed almost immune to this issue despite its adverse impact on many other adjacent industries," said Nabila Popal, research director with IDC's Mobility and Consumer Device Trackers.

"In all honestly, it was never fully immune to the shortages, but until recently the shortages were not severe enough to cause a decline in shipments and was simply limiting the rate of growth. However, the issues have now compounded and shortages are affecting all vendors alike.”

In addition to the component shortages, Popal also said other manufacturing and logistical challenges have rocked the smartphone industry, stemming from changes at the industry’s source.

“Stricter testing and quarantining policies are delaying transportation and power supply constraints in China are restricting manufacturing of key components,” she said.

“Despite all efforts to mitigate the impact, all major vendors' production targets for the fourth quarter have been adjusted downwards.

“With continued strong demand, we don't anticipate the supply-side issues to ease until well into next year," Popal added.

On a vendor basis, Samsung led the pack with 69 million units shipped — a year-on-year decline of 14.2 per cent — and 20.8 per cent market share.

The vendor beat out Apple, which came in second place, with 50.4 million units shipped — representing growth of 20.8 per cent — and 15.2 per cent market share, as well as Xiaomi’s third place performance with 44.3 million units — a decline of 4.6 per cent — and market share of 13.4 per cent.

Rounding out the top five was vivo and OPPO, shipping 33.3 million units and 33.2 million units, respectively.

IDC’s Q3 smartphone shipment research aligns closely with that of Canalys’, with its principal analyst Ben Stanton claiming earlier this month that the “chipset famine has truly arrived”.

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