Huawei’s Chinese mobile rivals look to capitalize on its US woes

Huawei’s Chinese mobile rivals look to capitalize on its US woes
Huawei briefly overtook Samsung as the world’s biggest handset maker in the first half of this year, before shipments fell 23 percent to 51.7 million units in the third quarter. (AFP)
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Updated 23 November 2020

Huawei’s Chinese mobile rivals look to capitalize on its US woes

Huawei’s Chinese mobile rivals look to capitalize on its US woes
  • ‘What we can see now, whether from Xiaomi, Oppo or Vivo, is that they’re raising their forecasts for next year’
  • Huawei still commands 41.2 percent of the market in the third quarter

SHENZHEN, China: Chinese handset rivals of Huawei Technologies including Xiaomi, Oppo and Vivo are making aggressive moves to seize market share from their giant rival, after stepped-up US sanctions hobbled Huawei’s supply chains, industry insiders say.
Last week Huawei said it has sold its budget Honor subrand for an undisclosed figure in a bid to safeguard the latter’s supply chain from US action, which has made it difficult to source essential components.
All the same, Huawei’s Chinese rivals smell blood in the mid-to high-end phone market. In August a Huawei executive said the company will not be able to produce its flagship processors that power its high-end smartphones.
“What we can see now, whether from Xiaomi, Oppo or Vivo, is that they’re raising their forecasts for next year,” said Derek Wang, an executive in charge of production at handset maker Realme, which shares a supply chain with Oppo.
“They believe the sanctions against Huawei will more or less hurt it in the international market, and they may want to take a share of the market from Huawei.”
Founded in 2018, Realme is on course to double its smartphone shipments to 50 million this year, Wang said. It has built a base with low price-offerings in Southeast Asia and India, and is looking to target Europe and China next year with a push into the high-end market, regardless of Huawei’s situation, Wang said.
In August, the US Commerce Department further choked Huawei’s access to US technology essential to its handset business, on the grounds that Huawei poses a security threat — a charge Huawei denies.
Huawei briefly overtook Samsung as the world’s biggest handset maker in the first half of this year, before shipments fell 23 percent to 51.7 million units in the third quarter, according to research firm Canalys.
Huawei still commanded 41.2 percent of the market in the third quarter, followed by Vivo with 18.4 percent, Oppo with 16.8 percent and Xiaomi with 12.6 percent, Canalys said. Apple has a lower share in China with 6.2 percent, but is attracting strong demand for its 5G iPhone 12, Canalys said.
Industry watchers have confirmed a ramping up of orders from vendors. Xiaomi has been most bullish, placing enough orders for up to 100 million phones between the fourth quarter of 2020 and first quarter of 2021, up 50 percent on projections before the August restrictions according to consultancy Isaiah Research. Oppo and Vivo’s production forecasts had also risen by around 8 percent each since August, with orders for up to 90 million and 70 million handsets respectively, Isaiah Research’s data showed.
Conversely, Huawei orders fell 55 percent to up 42 million handsets in that time.
All four companies declined to comment on the numbers.
Five industry sources on the supply chain side confirmed they had a surge in orders from the three companies.
Some analysts believe the firms might be too optimistic about their targets, but Realme’s Wang said stockpiling of components have also been driven by disruption to production caused by COVID-19 lockdowns earlier in the year and because Huawei’s move to boost its inventories impacted rivals’ supply chains.
The rush to secure supplies has reverberated across the electronics chain, said Paul Weedman, a supply chain project manager. “Prices have been rocketing recently,” he said, noting that it has become much harder to souce LCD screens even for tablets.
Analysts said Huawei’s sale of Honor may partly fend off competitors’ intrusion into the budget-end of the market, provided that Honor is able to resume sourcing US technology.
“We still expect clear year-on-year growth from Huawei and Honor’s smartphone rivals in 2021, but likely at a lower ratio than their earliest expectation.” said Flora Tang, an analyst with research firm Counterpoint.


Indonesia campaign helps SMEs enter Saudi market

Indonesia campaign helps SMEs enter Saudi market
Updated 19 January 2021

Indonesia campaign helps SMEs enter Saudi market

Indonesia campaign helps SMEs enter Saudi market
  • They will be the main target of the export initiative, which is estimated by the Indonesian Ministry of Trade to be able to generate $60 million

JAKARTA: Indonesia has launched a campaign to help small firms in the country compete for millions of dollars-worth of food trade in Saudi Arabia.

The government aims to help small and medium-sized enterprises (SMEs) improve the quality and competitiveness of their products to meet the Kingdom’s required standards, Indonesian trade and commerce officials have said.

Under normal circumstances, before the coronavirus disease (COVID-19) pandemic, around 1.5 million Indonesians a year make the pilgrimage to Saudi Arabia to perform Hajj and Umrah and hundreds of thousands work in the Kingdom.

They will be the main target of the export initiative, which is estimated by the Indonesian Ministry of Trade to be able to generate $60 million.

To meet the Saudi food regulator’s standards, the Indonesian Chamber of Commerce (Kadin), the Ministry of Trade, and the Ministry of Cooperatives and Small-Medium Enterprises have teamed up to assist SMEs in improving products such as bottled chili sauce, soya sauce, coffee, tea, and sugar that are in highest demand among Indonesians in Saudi Arabia.

Kadin chairman, Rosan Roeslani, told Arab News: “We have facilitated five small-medium enterprises that produce soya sauce to obtain Saudi Food and Drug Authority approval for distribution, while nine tea and coffee producers are in the pipeline to also obtain a license. We have also submitted the application for four bottled chili sauce producers.”

While travel and pilgrimage restrictions remain in place due to the COVID-19 outbreak, he said that the time before things get back to normal will be used to prepare the SMEs — which contribute 60 percent to the country’s gross domestic product and employ up to 90 percent of its workforce — for expansion into the Saudi market as soon as the pilgrimage sector resumes.

“We still have time to groom them as there are many aspects such as hygiene, and consistency in their product quality and quantity that they need to improve,” Roeslani added.

In 2014, the Ministry of Religious Affairs issued a regulation obliging catering companies that provided food and drink to Indonesian pilgrims in Saudi Arabia to source their products from Indonesian producers whenever possible.

Indonesia’s vice religious affairs minister, Zainut Tauhid Sa’adi, said that as each Indonesian pilgrim received food from caterers an average 75 times during his or her pilgrimage, demand was high but supply in Saudi Arabia remained limited and similar products from India and Thailand had been used instead.

Kasan Muhri, director general for export development at the Ministry of Trade, told Arab News that the program to prepare the SMEs had been in the making since 2017 and officials eventually decided to launch it this year despite the COVID-19 restrictions.

“Just because there are few Umrah pilgrims now and this year’s Hajj remains uncertain, it does not mean that the market is gone.

“People from around the world would still go to Saudi Arabia to perform the pilgrimage, not just Indonesians, so we are doing this to anticipate the market when the economy revives, and things are recovered. We don’t want to be left behind,” Muhri said.

Besides food and beverage products, officials say they are also looking into the possibility of exporting items such as goodie bags, prayer beads, and other pilgrimage accessories made by Indonesian SMEs.