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Cell Phone Production Shifts Overseas, China’s Cell Phone Exports Down by Over 5 Million Since 2015 Peak

China is the world’s largest manufacturer and exporter of cell phones, but exports have declined steadily from a 2015 peak of 1.343 billion units to 822 million units in 2022 – a drop of 521 million units over 7 years. Chinese media have conceded that “cell phone exports may never reach that peak again.”

According to China’s General Administration of Customs, October 2023 cell phone exports were 81.11 million units, up 10% year-over-year, but total 2023 exports in the first 10 months were down 6.4% to 642 million units. The continued export decline is largely due to falling global cell phone demand – Counterpoint research shows global smartphone shipments dropped from a 2017 peak of 1.55 billion units to 1.2 billion units in 2022 as consumers slow their upgrade cycle.

Another factor driving the decline is major brands like Samsung and Apple moving production out of China after 2014. Samsung has moved much of its production to Vietnam, Apple to other locales. This coincided with Chinese electronics manufacturing companies Xiaomi, Vivo and Oppo actively expanding overseas production bases since 2015 – notably in India and Indonesia, which have become major alternative sites. Vivo and Oppo now operate major factories in India with 60-72 million unit capacities.

Reasons for shift away from cell production in China include the rising cost of Chinese labor as well as import restrictions and tariffs by countries like India and Indonesia creating incentives for localized production in those countries.

Source: Central News Agency (Taiwan), November 19, 2023