Mobile phone shipments declined six percent in March compared to a year ago in China as the country contended with a slowdown in the economy.
Citing the China Academy of Information and Communications Technology, Reuters reported mobile shipments for March were 28.4 million, down from 30.2 million in March of last year. The decline of 6 percent comes on the heels of double digits declines for a few months in a row now. In addition to declining shipments, the Chinese government agency said the number of new devices that were launched by manufacturers in the country was 35 percent lower with 52 new handsets rolled out during the month. For all of last year, mobile phone shipments in China fell 15.5 percent. In February shipments fell by 19.9 percent year over year, marking the lowest amount of shipments for February since 2013, reported Reuters, citing the CAICT data.
The lackluster sales this year are being blamed on slowing economic growth in the country, replacement cycles that have been lengthened and a lack of new technology that will get users to replace their phones. Reuters noted that handset makers are contending with the declines by raising prices of phones and adding more features to meet the high end of the marketplace. That is aimed at increasing margins. Reuters pointed to the fact that last year Huawei, Oppo, and Vivo were able to land more customers in the $500 to $800 phone price range. That was an area that Apple controlled, but with Chinese consumers falling out of love with the iPhone, local players have been able to catch up.
The decline in mobile phone shipments for March is expected to hit Apple particularly hard, noted Reuters. Apple's lackluster sales in the country have forced third-party sellers in China to lower the prices of the iPhone. China accounts for 15 percent of Apple's revenue. In the fourth quarter of 2018, sales of iPhones in China declined by close to one-quarter on a year-over-year basis.