Coronavirus Lockdown Could Cripple Smartphone Industry; Supply Chains To Take Major Hit

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To curb the spread of coronavirus, the government has recently extended the nationwide lockdown until May 3. The lockdown was earlier scheduled to lift on April 14 but it was further extended due to continuous spike in the number of infected people. However, now it is expected that the centre will all allow some sectors to function from April 20, 2020.

Extended Lockdown Could Set Smartphone Industry Back By $2 Billion

 

This lockdown has forced all sectors to help their users and buyers. Similarly, telecom operators and handset makers are offering benefits to their users. The companies are offering subsidies and extended warranties on their products. Smartphone makers have shut down the production at their manufacturing units, and all workers have gone to their natives.

"Manpower disruption is also seen amid the lockdown. The migrant workers, truckers and helpers have gone back to their hometown. It will take some time to revamp the entire production cycle. Manpower and supply chain will be impacted until the new lockdown extension date of May 3," Realme India CEO Madhav Sheth told Gizbot in an email interaction.

This means if the government removes the restrictions from the sector on April 20, 2020, there will be issues related to manpower. The industry sources believe that the lockdown will affect the demand due to job loss and stress in almost all sectors.

"The lockdown will definitely have an impact on the demand due to potential job loss/stress in employment in many sectors. However, it has been notified that mobile manufacturing will be allowed from 20th, the supply is expected to be back on track around the 1st week of May," Faisal Kawoosa, founder of research firm techARC informed us.

The research firm also believes that initially, people will spend money on essential items, such as food and medicines. In fact, another research firm, Counterpoint estimated that the smartphone industry might lose $2 billion revenue during the lockdown. The firm states that the shipments might decline by 60 percent in April.

 

On the other hand, the internet sector is attracting many people during the lockdown as the mobile internet consumption has gone up by 30 percent, while demand for Wi-Fi installation has been increased by many folds.

Meanwhile, ICEA India Cellular and Electronics Association intimated that the government has allowed handset makers to start their operations from April 20. But, manufacturing plants in the restricted areas cannot start their operations.

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