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COVID-19 pandemic hammers global smartphone industry Updated: 2020-03-30 17:03:14 KST

The COVID-19 crisis is hammering all industries across the globe, and the smartphone industry is no exception.

"Worldwide shipments of smartphones dropped 38 percent on-year in February, the largest drop in history. It’s not due to consumers’ lack of income but rather because they’re afraid or unable to go outside to make purchases during this pandemic".

On top of the demand shock, there have also been production and supply issues because factories around the globe are closing to limit COVID-10 infections.
South Korean tech giant Samsung Electronics is putting production on hold until April 14th at its Noida factory in India, the world's biggest mobile phone manufacturing facility.
These production issues are also affecting global firms like Apple whose supply chains are dependent on Asian companies. For example, Samsung produced over 80 percent of the world's OLED smartphone displays in the April to June period last year.

"They'll have to do the hedging, lining up the alternative supplier, quick methods in terms of changing sources of supply and so on."

Selling more phones online can be one way to reach customers, but in some countries the way phones are sold makes this very difficult.
Disruptions in the smartphone supply chain could also mean the release of new models could be delayed by months.
In fact, Apple reportedly plans to push back the launch of its first 5G iPhone, possibly until next year.
Analysts say that it's not just about when the pandemic ends, but also how long the recovery takes.

"But because all the countries started at a different place, countries differ in how they track the disease. Korea has done a very good job at tracking. United States has not. So all the countries are going to have different impacts and different lengths."

"Even if we have our supply chain magically pop back to full, seamless operation, we need an appropriate policy response on the demand side to keep our economy healthy and to handle the effects of the crisis."

There is a hint of hope that smartphone sales this month won't be as bad as February. But the complexity of the global smartphone supply chain suggests the road back to normal will be bumpy and unpredictable.
Kim Dami, Arirang News.
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