India smartphone market falls by nearly 50% in Q2 2020

In India, smartphone shipments fell 47% in Q2 2020, to 17.3 million units as the country faced an unprecedented shutdown of its economy until Mid-May due to COVID-19. Smartphone vendors faced a diabolical situation, dealing with both low supply due to a complete halt in production and diminished demand, as online and offline retailers were prohibited from selling smartphones.

Xiaomi was the market leader in India, capturing 31% of overall market share, shipping 5.3 million smartphone units in the quarter. Vivo maintained the second position, shipping 3.7 million units, and grew its market share to 21.3% from 19.9% in Q1 2020. Samsung was third, with 2.9 million smartphones shipped, and also saw exports impacted as its largest manufacturing plant outside of Vietnam shut down for most of Q2. Oppo edged out Realme to take the fourth position as it shipped 2.2 million units, compared to Realme’s 1.7 million.

Canalys Analyst Madhumita Chaudhary, said, “It’s been a rocky road to recovery for the smartphone market in India. While vendors witnessed a crest in sales as soon as markets opened, production facilities struggled with staffing shortages on top of new regulations around manufacturing, resulting in lower production output. The fluidity of the lockdown situation across India has had a deep-rooted effect on vendors’ go-to-market strategies. Xiaomi and Vivo have undertaken an O2O (offline-to-online) strategy to support their massive offline network. Online channels, too, while seeing a positive effect of the pandemic on market share, have seen sales decline considerably.”

Apple was also impacted, as shipments fell 19% year-on-year to just over 250,000 in Q2 2020. The vendor has recently announced its plans to diversify its supply chain and is pushing its major partners Foxconn and Wistron to increase its investments in India.

According to the analyst, the transition to 5G is the next big opportunity, and Jio’s announcement of readiness to deploy 5G, as soon as spectrum is made available, has provided a ray of hope to most vendors who have been beaten by the current pandemic.