Smartphone prices set to rise as stocks run out
SMARTPHONE PRICES ARE EXPECTED TO GO UP BY 6-7% AS EARLY AS THE NEXT 15-20 DAYS
NEWDELHI: Smartphone prices are set to rise in India as early as over the next fortnight as retailers and stockists run out of stocks following China’s shutdown of a large number of factories due to the coronavirus outbreak.
The indefinite closure of factories has disrupted supplies to India, where Chinese phones command the biggest share of the market. Industry stakeholders expect the reduced stocks to impact prices of affordable smartphones and feature phones the most.
The coronavirus outbreak has so far claimed more than 1,500 lives and infected over 42,000 people worldwide. Cases have been found in other countries, including India. China’s supplies of electronic goods and products comprise one of the biggest share of trade with India.
Nikhil Chopra, chief sales officer of megUS Mobile, said the company expects a 10% rise in the prices of feature phones, while smartphone prices are expected to go up by 6-7%. “This will happen in the next 15-20 days, you will see the impact,” he added.
One of the factors why premium smartphones won’t be hurt as much is because the demand for them is already low in India. However, Adwait Mardikar, research analyst at Canalys, said he expects that phones that are fully imported from China, like some of Apple’s iPhones, will definitely be hurt by the shutdowns.
The impact of the shutdowns due to the outbreak is expected to last as much as six months. Component prices are rising in China thanks to a shortage, and also because demand is suddenly much higher than supply.
Chopra of megUS Mobile said the impact is estimated to last between 60 and 180 days. Mardikar agreed saying that it should last until the second quarter of FY21.
Some original equipment manufacturers (OEMs) have already started raising prices. The largest smartphone seller in India, Xiaomi, raised prices of its popular Redmi Note 8 smartphone last week.
A Gurgaon-based distributor of Samsung phones said on condition of anonymity that stocks are expected to dwindle in March. Another person said a high-end phone maker in India is expecting to run out of stocks for this quarter by the end of February.