Largest Chinese OEMs Could Miss 2017 Shipment Expectations

Huawei Logo 2016 AH

Largest Chinese original equipment manufacturers (OEMs) could miss 2017 shipment expectations due to a number of reasons, industry sources said on Friday. Huawei, OPPO, and Vivo have all decreased their shipment goals in recent weeks after concluding that they are extremely unlikely to meet them, insiders revealed, adding that the companies are primarily troubled by devices meant for foreign markets. None of the three strongest OEMs in the Far Eastern country have yet found a viable strategy to mimic their domestic growth in the United States, Europe, and many other Western markets, sources believe, specifically stating that Vivo and OPPO’s approach to market penetration that entails financing robust retail operations has yet to pay off and it remains to be seen whether that ever happens.

Huawei’s representatives have often touted the company’s western ambitions and the goal of becoming the largest smartphone vendor in the world but the company is said to have shipped 30 million handsets in the second quarter of 2017, two million less than it managed in the same period last year. While the Chinese consumer electronics manufacturer previously boasted about individual months in which it managed to outship Samsung and Apple — currently the only two bigger OEMs on the planet — wider trends show that the firm is still somewhat away from realizing its goals. The Shenzhen-based tech giant recently tried penetrating the U.S. market with a number of high-end and aggressively priced offerings like the Mate 9 but the effects of these efforts were significantly limited after the company was met with a lukewarm reception from domestic carriers that are still reluctant to carry its products, partially due to political reasons, i.e. the fact that the company was effectively blacklisted by the government several years ago.

OPPO and Vivo shipped 99.4 million and 77.3 million smartphones in 2016, respectively, with both sister companies hoping to reach 150 million units this year, though industry sources remain skeptical abut their ability to do so. All major OEMs in China have to pursue overseas endeavors if they’re hoping to grow their businesses in a significant manner in the medium term and an update on their efforts to do so will likely follow in the coming months.