Xiaomi, OPPO and VIVO Set Many Smartphone Part Orders To Japanese Companies

According to the Nikkei, Japanese electronic component manufacturers have received a large number of stock orders from Chinese smartphone manufacturers such as Xiaomi, OPPO and VIVO, which made up for the loss of Huawei’s orders.

After the US sanctions took effect on September 15, Huawei, the world’s second-largest smartphone manufacturer, stopped orders. However, the surge in demand from competitors such as Xiaomi, OPPO and VIVO has filled the gap. Some customers are looking for Japanese technology, worrying that the United States may extend the ban to other Chinese companies.

According to data from the market research organization IDC, the total shipment of smartphones should decline for the fourth consecutive time in 2020. It should reduce by 10% to 1.2 billion, partly due to the coronavirus pandemic. However, some manufacturers have more aggressive production plans to fill Huawei’s market share.

Also Read: Huawei and Xiaomi Purchased Ultra-thin Flexible Glass (UTG)

Apple recently announced to its suppliers that it plans to produce 220 million iPhones this year, 10% more than previously expected. Xiaomi and OPPO hope to seriously increase production in 2021. According to several suppliers, they will achieve the goal of 200 million smartphones each, which is more than half of 2020.

Xiaomi Mi Store UK

Huawei will produce about 190 million smartphones this year, which is 20% less than in 2019. Although Huawei has stocks of parts and components to minimize the direct impact of sanctions, these reserves can only go so far. The company should have approximately 6 months of parts and components. The production must decline from the first quarter of 2021.

What Do Japanese Companies Think About This?

Japanese electronic component manufacturing company TDK expects that other companies will purchase more than Huawei’s lost business. An employee of a large Japanese electronic parts manufacturer said, ‘The orders at the end of September have reached a record high. And some manufacturers also intend to double their production plans for next year.’

The chip maker Renesas Electronics Corp. was asked by a Chinese customer to have non-US engineers redesign a specific product at a factory outside the US. Zuken, a supplier of circuit board design software, reports that companies in China and elsewhere are increasingly interested in finding alternatives to American-made tools.

In addition, suppliers are keeping their distance from the United States in order to continue business with Huawei. Sumitomo Electric Industries, Ltd. has begun to use equipment made in Japan to replace some American equipment to test components for Huawei base stations.

However, a supplier warned that this is a special one-time demand boost, which may be adjusted in early 2021.

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