The Rise of Domestic Brands in the Chinese Smartphone Market

The Rise of Domestic Manufacturers in China’s Smartphone Market

After a long time, all of the top five best-selling smartphone manufacturers in China are domestic brands. This situation resulted in Apple dropping to sixth place, marking the first time it has been outside of this top five group. According to technology market analysts at Canalys, Apple’s market share in China declined to 14% in the second quarter, with Xiaomi immediately following the smartphone giant. This drop is associated with a 3.1% decrease in Apple’s annual shipments. On the other hand, shipments of Android-based phones, including Chinese models, increased by 11.1%.

Meanwhile, the overall smartphone market in China recorded an approximate 10% growth compared to the same period last year. Vivo is in first place. While Apple was in first place in the fourth quarter of last year, it fell to third, fourth, and even fifth place in the first quarter depending on which source is referenced. Although Canalys and IDC data do not entirely agree on the current rankings, they both agree that Vivo is in first place and Xiaomi is in fifth place. In the midst of this ranking are brands like Huawei, Honor, and Oppo.

Interestingly, both reports indicate that Huawei’s annual growth is quite high. According to Canalys data, this growth rate is recorded at 41%, while IDC’s report shows this rate as 50%. Huawei’s high-end smartphones seem to have achieved significant success in competing with Apple. IDC’s senior research analyst Arthur Guo stated, “In the first half of the year, despite the US trade restrictions, Huawei held a leading position in the market and further closed the gap with Apple in the segment above $600.”

On the other hand, IDC analyst Jacob Zhu also mentioned that “As consumers tend to use their devices longer, there is a trend towards high-end phones in China” and added: “This has increased the share of shipments above $600 from about 23% in the same period last year to around 26% in 2Q24.” However, Canalys points out that part of the decline in Apple’s market share is due to its strategy of keeping iPhone prices stable and maintaining healthy margins for channel partners. According to the firm’s data, there is not a significant difference between iPhone and Xiaomi. With the introduction of Apple Intelligence, it seems possible for Apple to return to the top five.