Huawei to halve smartphone output in 2021 – report

The fate of Huawei Technologies remains a topic of considerable speculation. As we've previously noted, it has been very difficult to gauge just how much damage US sanctions and international resistance have done to the Chinese network equipment giant.

Nikkei Asia has nevertheless taken a stab at predicting what this year might look like for the vendor in terms of smartphone sales, largely based on reports from undisclosed sources at Huawei's suppliers.

According to the news outlet, Huawei has notified its suppliers that its smartphone component orders will fall by more than 60% this year because it only plans to make 70 million to 80 million smartphones in 2021. That's a pretty sizable drop from last year's estimated shipment of 188 million smartphones, primarily owing to the fact that it is limited to ordering components only for 4G smartphones, not 5G.

Whether or not the reports are accurate remains to be seen, and Huawei has not been responding to requests for confirmation. The coming months will soon reveal how many smartphones it is able to ship.

Losing ground

The writing was already on the wall in 2020. According to Counterpoint Research, Huawei only shipped 33 million smartphones in the fourth quarter of 2020, down from 56.2 million a year previously.

The Chinese vendor also dropped to sixth place in the rankings in the last three months of 2020, although Counterpoint said Huawei remained the third-largest smartphone supplier in 2020 as a whole because of its strong performance in China.

Indeed, Huawei's domestic market was said to have contributed around 70% of its total shipments, driven by 5G models such as the Mate 40 Pro and Nova 7.

Want to know more about 5G? Check out our dedicated 5G content channel here on Light Reading.

Counterpoint also said Huawei remained the leading smartphone vendor in China last year with a 41% market share, although this appears to include the Honor brand that Huawei sold in November.

However, Counterpoint research analyst Flora Tang said: "Following component shortages after the US trade sanctions effective September 15, sales of Huawei and Honor dropped a staggering 26% YoY in Q4 2020. Their combined market share also slipped to 32% in the same quarter."

The research company said China's overall smartphone sales declined 17% year-on-year in 2020, the sharpest decline in the last three years.

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— Anne Morris, contributing editor, special to Light Reading

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