Smartphone Potential Declining and Rising Prices, Why?

 


The global chip shortage has had a major impact on the automotive console and video game industries. So next, most likely this problem will spread to the smartphone business.
This year the supply of semiconductors has declined due to several factors. Mention the closure of factories due to the Corona outbreak and vice versa the demand for electronic goods continues to increase.



Car manufacturers such as General Motors and Ford have reduced or even stopped production of certain vehicles. Then the Xbox Series X and PlayStation 5, the two latest gaming consoles, are also hard to come by.





In fact manufacturers like Apple and Samsung have kept a lot of chips so it can be avoided. The reason is, smartphone manufacturers are more cautious in looking at problems than automotive vendors. They are also liked because of their high volume.



However, at the moment, the scarcity of chips is starting to affect smartphones. Automotive manufacturers seem to be aggressive in grabbing their share, thus causing stiff competition.



Apple CEO Tim Cook has warned that the supply of endangered iPhones will stop. The rarity is not in powerful main processors, but in other chips such as audio chips and screens.



“While Apple is a big player that gets priority from chipmakers, they’re still as threatened as anyone else,” said Glenn O’Donnell of research firm Forrester.



Small vendors such as Lenovo, TCL, and HMD Global will most likely be affected. "We're seeing a tightening of the supply chain as a whole. We're probably seeing certain imbalances in the market," said Florian Seiche, HMD's CEO.



This situation can affect the scarcity of certain smartphone models due to constrained production. It is estimated that there will be a decrease in production of up to 10%. “This may not be a big impact, but it will make an impact,” O’Donnell said.



So the price also tends to go up. "The effect may be higher smartphone prices and a deeper scarcity on certain models. In Apple's case, maybe you can get a luxury iPhone 12, but not the iPhone XS. Other manufacturers like Samsung and Chinese vendors like Xiaomi and Huawei will also feel it . "O'Donnell concluded.
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