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OPPO rises to the top in China as HUAWEI’s fortunes dwindled

By Nadeem Sarwar March 6, 2021, 2:30 am
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Not too long ago, HUAWEI was at the peak of its smartphone game, launching phones that led the industry when it came to innovation and experience, while also covering the budget segment with great value phones. The company even managed to eclipse Apple and was breathing down the neck of Samsung for the crown of global smartphone industry dominance. Thanks in no part to stringent trade sanctions, the company’s fortunes have dwindled sharply, and fellow Chinese smartphone maker OPPO appears to have milked the opportunity a little too well – rising to the top of Chinese market.

Rivals at home will continue to reap gains from HUAWEI's lost ground

As per Counterpoint Research, OPPO became the leader of Chinese smartphone market for the first time in January 2021, commanding a market share of 21%. OPPO rose to the summit riding on top of a 33% growth on a monthly basis and 26% YoY growth compared to the same month last year. It was closely followed by Vivo at 20%, while Xiaomi took the third spot with a market share of 16%.

READ MORE: HUAWEI is reportedly planning to launch electric cars as early as 2021

Rivals grew as HUAWEI lost the 5G phone race

OPPO’s growth – and the rivals’ too – comes at the expense of HUAWEI which has been struggling to source 5G components in a market where 65% of all phones sold in Q4 2020 were 5G-ready. And it appears that those troubles are not going away anytime soon for HUAWEI.

“Xiaomi is benefiting the most from the decline in HUAWEI’s online share, while OPPO and vivo have been capturing the offline segment. At its peak, HUAWEI had more than 10,000 retail and experience stores across China. This number has been decreasing since Q4 2020. HUAWEI has also spun off HONOR as a separate brand. With HONOR now being considered as a separate brand, it further reduces HUAWEI’s market share in China.”

Selling HONOR may have saved the sub-brand, but it came at the cost of lost market share

With the departure of its HONOR sub-brand, HUAWEI has now shifted its attention to the premium segment that includes its P-series and Mate flagships. And even though the profit margins are high, the shipment figures are much lower compared to phones in the budget segment – which only means that HUAWEI’s market share is going to shrink even further. Counterpoint Research predicts that key rivals – OPPO, Xiaomi, and Vivo – will continue to grow at the expense of HUAWEI’s decline.

The road ahead isn’t rosy for the troubled company

The company has tried getting its name off the Entity List that essentially bars US companies from trading with HUAWEI without a special license, but the company hasn’t tasted success yet. And until that situation resolves, the doors to supply chain industry – especially those with roots in the US – as well as access to Google’s ecosystem of services, will remain closed.

Talking about a silver lining amidst all the woes, HONOR might have its fortunes revived, now that it is no longer associated with HUAWEI. In fact., HONOR CEO George Zhao recently hinted that the company’s partnership with Google might soon resume.

READ MORE: HUAWEI Mate 40 Pro review: keeps getting better and better

In the meanwhile, HUAWEI continues to focus on the development of AppGallery – its own app repository based on HUAWEI Mobile Services (HMS) core after being deprived of access to GMS (Google Mobile Services) – and with it, access to key Google services such as Maps, Gmail, and Play Store to name a few. While AppGallery continues to add more apps as well as developers, the company also has ambitious plans for its in-house HarmonyOS that is said to run across a wide range of products ranging from phones and computing machines to home appliances and automobiles.


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