First, the Wuhan coronavirus outbreak was rumored to impact shipments of protective accessories for Samsung’s highly anticipated Galaxy S20 handset family, which is mere hours away from an official announcement at the time of this writing. Then Apple closed its stores and offices in China “out of an abundance of caution.” 

Samsung doesn’t have as much to be worried about as Huawei

Overall, global smartphone production could take a year-on-year hit of around 12 percent, dropping to 275 million units. Honestly, that doesn’t sound so bad to us, especially compared to the 50 percent decline in sales tipped for China alone.

There are multiple reasons why the industry is projected to hold up relatively well, starting with the fact that manufacturers typically maintain a “healthy inventory” before the Chinese New Year, which was celebrated on January 25. Secondly, Q1 is a “historically weak” season for smartphone production, making these problems a lot easier to swallow than if similar ones had appeared prior to the always busy holiday period.

But perhaps more importantly, not all smartphone vendors are impacted in the same way by the novel coronavirus epidemic. Samsung, for instance, has its main production base located in Vietnam, which means its Q1 numbers are only expected to dip by 3 percent compared to the previous TrendForce forecast, to a grand total of 71.5 million units. In contrast, Huawei’s production prognosis for the January – March 2020 window now sits at 42.5 million units, down 15 percent from initial expectations.

Full-year smartphone production may not be greatly impacted

On the bright side, TrendForce does not have an “overly pessimistic outlook” towards overall 2020 smartphone production, expecting most demand to be “deferred rather than eliminated”… as long as the outbreak “can be controlled and a basic level of demand can be supported by the overall global economy.”