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China’s smartphone manufacturers are restructuring their product lines in response to rising memory chip costs and escalating supply chain expenses.
An analyst from a technology research firm highlighted that increases in storage and supply chain prices over the past year have primarily impacted phones priced under $100. These cost pressures are expected to persist this year, influencing manufacturers’ pricing strategies and shipment timelines.
In the first nine months of the previous year, global smartphone shipments reached approximately 900 million units, with Chinese brands making up over 60 percent of this volume. While entry-level devices continue to dominate overseas markets for Chinese firms, their profitability is under pressure due to rising costs of essential components, including memory chips.
Historically, Chinese phone makers relied heavily on affordable models to achieve scale, but now they are shifting focus toward refining their product structures. Over the past year, they have gained additional market share abroad, yet their competitive tactics and target pricing segments are evolving considerably.
Among leading brands, Honor experienced the fastest growth overseas in the first three quarters last year. Its sales increased by 55 percent year-over-year, driven mainly by markets in the Middle East, Africa, and Southeast Asia. Unlike many Chinese manufacturers that concentrated on entry-level products, Honor targeted the mid-range segment priced between $300 and $500. These products made up 23 percent of its international shipments last year, surpassing other major Chinese brands.
The overseas sales of Honor’s X9 model more than doubled compared to its predecessor, the X9b, while sales of the Honor 400 series surged approximately 86 percent relative to the Honor 200 series.
Other Chinese brands are also restructuring. For example, Oppo Mobile has shifted its focus from entry-level devices around $200 toward introducing more mid- to high-end 4G and 5G smartphones in certain developing markets. Xiaomi is working to enhance its brand image and increase the share of premium devices in Southeast Asia and Western Europe. Meanwhile, Vivo is expanding its footprint in Southeast Asia and investing more in North Africa and Latin America, especially in Brazil.
Additionally, Shenzhen-based Transsion Holdings, which has been heavily affected by rising storage costs, is offering financial solutions like installment payments to help consumers lower purchase barriers, thereby maintaining shipment levels in emerging markets.
Industry experts suggest that this ongoing reshuffle in the global smartphone landscape might just be beginning, driven by the combined effects of increasing storage prices and supply chain costs.
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