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World NewsHonor, the smartphone brand Huawei sold off, regains share in China

Honor, the smartphone brand Huawei sold off, regains share in China

A citizen reveals Honor 50 smartphone on June 16, 2021 in Shanghai, China.

VCG | Visual China Group | Getty Images

GUANGZHOU, China — Honor, the smartphone brand Huawei spun off final yr, is starting to regain share in China’s fiercely aggressive cell phone market.

Honor notched a 15% market share in China in August, making it the third-largest smartphone participant in the nation — the first time it has held that place in a yr, Counterpoint Research mentioned in a report on Wednesday.

The smartphone firm trails home rivals Oppo and Vivo. Sales of Honor units rose 18% in August in comparison with July, making it certainly one of the quickest rising manufacturers in China.

In November, Huawei sold its funds brand Honor to a consortium of patrons together with the authorities of Shenzhen, the metropolis the place its headquarters is situated.

Huawei did that to make sure Honor survived as a result of U.S. sanctions on the Chinese expertise big minimize off provides to key elements and crippled its smartphone enterprise, which included Honor at the moment. Selling it off allowed Honor to get entry to the key elements like semiconductors once more.

Honor’s resurrection will additional intensify competitors in the Chinese market in H2 2021.

Tarun Pathak

analysis director, Counterpoint Research

“After being spun off from Huawei, Honor was able to restore ties with component players,” Tarun Pathak, analysis director at Counterpoint Research, mentioned in a press launch. “Since then, leveraging its strong R&D [research and development] capabilities, Honor has launched new products and has been on a rapid recovery path in China.”

In January, Honor launched a mid-range telephone referred to as the V40, adopted by the Honor 50 in June. This month, it launched the larger finish Honor 3 collection of smartphones which can be launched in China and different international markets together with Europe.

“Honor is also targeting the premium segment with the Magic series, thus expanding its portfolio across price bands,” Pathak mentioned.

“There was also a pent-up demand from the loyal Huawei and Honor consumers who held on to their devices and did not switch to other brands. Its strong relationships with distributors also helped Honor relaunch products on a large scale. Honor’s resurrection will further intensify competition in the Chinese market in H2 2021,” Pathak mentioned.

Honor is focusing on international markets however success there may be more durable to search out. Its international market share hit 3.7% in August, up from 1.5% in February, however that’s primarily as a result of positive aspects in China, Neil Shah, analysis director at Counterpoint Research, advised CNBC.

Read extra about China from CNBC Pro

In worldwide markets, Honor will face stiff competitors from the likes of Apple and Samsung, in addition to China’s Xiaomi, which as continued to steal the market share misplaced by Huawei.

“Growth outside China is likely to be gradual, as loyalty in the mid-segment remains low and Honor will also have to rebuild its distribution network. Then, there are also intensifying component shortages which can likely hinder Honor’s expansion in 2021,” mentioned Varun Mishra, senior analyst at Counterpoint Research, in a press launch.

Mishra was referring to the scarcity of semiconductors that’s at the moment affecting industries throughout the board from autos to client electronics.

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