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Smartphone market (from 20)
local COVID outbreak. Since the base is
also Apple’s main site for manufactur-
ing the iPhone Pro models, this incident
will impact the total iPhone production in
4Q22.
Following Samsung at first and Apple at
second, the ranking of the top five global
smartphone brands by production for
3Q22 is rounded out by Xiaomi, OPPO, and
Vivo at third, fourth, and fifth respectively.
In this ranking, Xiaomi encompasses
its sub-brands Redmi, POCO, and Black
Shark; OPPO includes Realme and OneP-
lus; and Vivo also takes account of iQoo.
Xiaomi maintains same volume
Among them, only Xiaomi maintained
about the same device production vol-
ume compared with the previous quarter,
whereas the other two recorded a QoQ
drop.
All of them have been constrained in rais-
ing production during the second half of
2022 due to the pressure to correct excess
inventory.
They also have to deal with COVID-19
lockdowns in the home market and the
recent deceleration of India’s economic
growth. Moving into 4Q22, these three
Chinese brands are expected to post most-
ly flat growth in device production.
Looking further ahead, Xiaomi, OPPO, and
Vivo will be facing significant challenges.
First, China as their home and primary
market is already highly saturated.
The enforcement of the zero-COVID policy
by the Chinese government has further
caused a freeze in domestic demand dur-
ing the recent period.
JANUARY 2023
At the same time, Honor has emerged to
pose a direct threat in the competition for
domestic market share.
The domestic supply chain
To maintain growth, Xiaomi, OPPO, and
Vivo will have to concentrate on overseas
expansions while retaining their domestic
market shares. To escape fallout from the
U.S.-China Dispute, Chinese smartphone
brands will support the strengthening of
the domestic supply chain by developing
their own chips
Samsung, Apple, and Huawei have been
developing chips such as the mobile SoC
111 to maintain a loyal group of customers
and provide effective market positioning
for their high-end device models.
Because these three brands have been
able to generate additional values with in-
house components, the other major Chi-
nese brands are now following their foot-
steps and committed to maintaining teams
dedicated to chip design.
Xiaomi, for instance, has developed the
mobile SoC Pengpai S1, the imaging pro-
cessing chip Pengpai C1, and the 120W
fast-charging chip Pengpai P1. OPPO, too,
has unveiled a discrete ISP named Ma-
riSilicon X and is expected to introduce an
in-house AP in 1Q24.
Geopolitical competition
Looking at these examples, TrendForce be-
lieves that while Chinese brands are using
in-house chips to raise their profiles, their
more important aim is to strengthen the
domestic supply chain as China and the
U.S. are now locked in an escalating geo-
political competition.
TrendForce estimates that global smart-
phone production will total around 316
million units for 4Q22, translating to a
QoQ growth of 9.3%. trendforce.com