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HomeTrendingDespite government crackdowns in India, Chinese cellphones continue to dominate the market

Despite government crackdowns in India, Chinese cellphones continue to dominate the market

 

Chinese smartphone manufacturers including Xiaomi, Vivo, and Oppo are being investigated by Indian government agencies.

The businesses still control the Indian smartphone market despite this.

The government may be considering barring Chinese smartphone manufacturers from the low-cost market, according to a recent report.

According to industry statistics, Chinese businesses produced four out of every five smartphones that were sold in India during the first quarter of June. This is true despite the Indian government’s focus on Xiaomi, Oppo, and Vivo, the three Chinese smartphone behemoths that jointly hold 50% of the Indian smartphone market.

Along with the government’s crackdown, there have been calls in India for a boycott of Chinese goods ever since the two nations clashed in the Galwan valley in 2020.

Nirmala Sitharaman, the finance minister, recently talked in the Rajya Sabha about the crackdown on Chinese businesses. Sushil Modi of the Bharatiya Janata Party posed the query, and this was the response.

Why Chinese smartphones are cheaper? 

Chinese smartphone manufacturers reportedly held 79% of India’s smartphone market share in June 2022, up from 75% the previous year, according to a Counterpoint Research research.

The second-largest smartphone manufacturer in India and the only non-Chinese company to do well is Samsung. In Q2 2022, it recorded a market share of 19%, a negligible 1% improvement over the same time in the previous year.

Despite a government crackdown on Chinese companies, Chinese smartphone manufacturers shipped three out of every four phones sold in India in the second quarter, according to a Canalys analysis. However, the Indian market fell sequentially as a result of sluggish demand.

According to a Canalys analysis released on Wednesday, the Indian smartphone market expanded by 12% in the June quarter over the same period in 2017, on a lower baseline due to the industry’s exposure to a second wave of Covid-19 in 2021.

Shipments decreased 5% in comparison to the first quarter of 2022, the third consecutive quarter of reductions brought on by waning Indian market demand.

The Analysis Report

Four of the top five smartphone manufacturers in the nation are Chinese, with Xiaomi Corp leading the pack with 7 million handsets sold. According to Canalys, Chinese manufacturers shipped 76% of all smartphones sold in the world during the most recent quarter.

According to Sanyam Chaurasia, an analyst at Canalys, the combined market share of Chinese vendors was slightly lower than it was during the same period last year when it delivered 80% of all handsets on the market. He continued by saying that rivals like Samsung and Apple have been catching up.

Additionally, since a deadly border conflict in 2020, Chinese smartphone companies have been the target of a continuing government crackdown that has intensified.

The Previous Raid by ED

Earlier last month, hundreds of Vivo offices were raided by Indian police. The country’s financial crime authority, the Enforcement Directorate, announced that it had confiscated 119 bank accounts connected to Vivo India, totaling US$58.7 million. The action came after similar inquiries into Xiaomi and the industry heavyweight Huawei Technologies Co.

The Enforcement Directorate claimed to have confiscated US$725 million from Xiaomi in May, accusing the Beijing-based company of sending money illegally. Later, the corporation received a demand for US$87.8 million in unpaid import taxes from India’s finance ministry.

All three Chinese businesses have vowed to cooperate with authorities and always abide by local rules and regulations.

When it comes to government inspection, Chaurasia from Canalys highlighted that “business continues as usual, but Chinese brands need to take care of compliance risk moving forward.”

Xiaomi continues to be the most popular brand in India, however, because to supply chain challenges, its market share has decreased recently. Xiaomi has also announced the launch of CyberOne, a humanoid robot in September.

In the second quarter, Xiaomi held 19% of the Indian market, a decrease from 29% during the same time last year. With an 18% market share, it came in just ahead of Samsung Electronics and was followed by the Chinese companies Realme, Vivo, and Oppo.

“Due to the pent-up demand in India, Xiaomi has experienced supply challenges for the past three to four quarters. Realme, Tecno, Infinix, and Samsung are examples of challenger companies with abundant supply that have gained momentum at that time, according to Chaurasia.

With its solid portfolio, Xiaomi should be able to stave off additional competition for the remainder of the year, according to Chaurasia.

Xiaomi Analysis Report

For quite some time, Xiaomi has been the subject of an investigation by Indian authorities. Xiaomi was accused by the Enforcement Directorate (ED) of sending $5,551.27 crore in unlawful payments in February 2022.

The majority of the allegedly unlawful remittances—more than 80%—were routed to the Qualcomm Group, which supplies the majority of Xiaomi’s chipsets.

The company’s shipments have decreased by 26% year over year, and there has been a noticeable loss in Xiaomi’s market share in India. However, the Counterpoint research has ascribed this to component shortages, inflation, and rising pricing.

It’s interesting to note that despite the company’s losing market share, all the other big smartphone manufacturers have declared growth.

Vivo Analysis

Another business that the government is scrutinizing is Vivo. The ED raided 44 Vivo locations and charged the corporation with sending close to $8 billion to China. Previously there was news of the Vivo India Money Laundering Case.

The company’s market share has been growing over the past several months, and in Q2 2022, with a 17% market share, the company recorded a 22% year-over-year gain.

According to Counterpoint, Vivo’s success has been powered by its new products in a variety of markets, including the X80 in the premium market and the T series in the mid-range market.

Surprisingly, Vivo is the second-largest manufacturer of 5G smartphones, behind Samsung, with a 23% market share.

Realme Analysis

Another Chinese smartphone manufacturer, Realme, has announced a growing market share. It’s interesting to note that the company claimed the largest year-over-year growth among manufacturers of smartphones, with a 23% growth and a market share of 16% in Q2 2022.

Despite the expansion, Vivo’s expansion caused the business to fall from third place in Q1 2022 to fourth place in Q2 2022.

Realme’s aggressive physical and online distribution tactics are credited with driving the company’s growth.

Oppo Analysis

The Directorate of Revenue Intelligence (DRI), the nation’s top anti-smuggling organization, has begun investigating Oppo for possible customs duty evasion.

The company has consistently held the fifth spot in the Indian smartphone market, despite its shifting market share. With an 11% market share, the company recorded an 18% year-over-year growth in Q2 2022.

OnePlus Analysis

OnePlus, a well-known smartphone manufacturer with a growing product line has fallen short of the top five spots. After entering the country’s mid-range category with the debut of the Nord series, the company has been operating well.

In Q2 2022, it revealed a remarkable 45% rise year over year. It’s interesting to note that the business was one of those targeted by the Income Tax Department in 2021.

OnePlus was only a minor player in the entire smartphone industry in Q2 2022, despite having experienced rapid development, with a market share of just 4.1%. For more such updates read here.

 

IEMA IEMLabs
IEMA IEMLabshttps://iemlabs.com
IEMLabs is an ISO 27001:2013 and ISO 9001:2015 certified company, we are also a proud member of EC Council, NASSCOM, Data Security Council of India (DSCI), Indian Chamber of Commerce (ICC), U.S. Chamber of Commerce, and Confederation of Indian Industry (CII). The company was established in 2016 with a vision in mind to provide Cyber Security to the digital world and make them Hack Proof. The question is why are we suddenly talking about Cyber Security and all this stuff? With the development of technology, more and more companies are shifting their business to Digital World which is resulting in the increase in Cyber Crimes.
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