China’s Handset Shipment Growth to slow this Year

Handset shipments from manufacturers based in China grew greatly in 2007, moving 229 million units for the year. This growth is 76% over the 2006 numbers of 130 million handsets shipped. According to iSuppli Corp this growth rate will slow down dramatically in 2008. It is predicted that around 274 million units will reach the market from China, which means a growth of nearly 20%. These figures presents iSuppli’s forecast for total handset shipments from manufactures based in China for the period 2006 through 2008.

“There were two major drivers for the fast growth in China’s handset industry during 2007,” said Kevin Wang, senior analyst, China research for iSuppli Corp.

“One was the continuous increase in domestic demand from first-time buyers and the replacement market. The other factor was the significant increase in export shipments from Chinese handset manufacturers. Domestic OEMs, such as Huawei and ZTE, doubled their export shipments. Furthermore, domestic gray market suppliers shipped millions of handsets to developing countries.”

The Chinese market is expected to slow this year because of an in crease in the Consumer Price Index, an increase in housing prices and major fluctuations in the Chinese stock market. Handsets that support the Global Positioning System or mobile TV will remain popular but other features shouldn’t fuel new sales. Therefore, the replacement market will show little growth in 2008, as customers are willing to stick to their old mobile phone features.