A citizen reveals Honor 50 smartphone on June 16, 2021 in Shanghai, China.
VCG | Visible China Group | Getty Pictures
GUANGZHOU, China — Honor, the smartphone model Huawei spun off final 12 months, 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 within the nation — the primary time it has held that place in a 12 months, Counterpoint Analysis mentioned in a report on Wednesday.
The smartphone firm trails home rivals Oppo and Vivo. Gross sales of Honor units rose 18% in August in comparison with July, making it one of many quickest rising manufacturers in China.
In November, Huawei sold its budget brand Honor to a consortium of patrons together with the federal government of Shenzhen, town the place its headquarters is positioned.
Huawei did that to make sure Honor survived as a result of U.S. sanctions on the Chinese technology giant cut off supplies to key components and crippled its smartphone business, which included Honor at the moment. Promoting it off allowed Honor to get entry to the important thing elements like semiconductors once more.
“After being spun off from Huawei, Honor was in a position to restore ties with part gamers,” Tarun Pathak, analysis director at Counterpoint Analysis, mentioned in a press launch. “Since then, leveraging its sturdy R&D [research and development] capabilities, Honor has launched new merchandise and has been on a speedy restoration path in China.”
In January, Honor launched a mid-range phone called the V40, adopted by the Honor 50 in June. This month, it launched the upper finish Honor 3 sequence of smartphones which will likely be launched in China and different international markets together with Europe.
“Honor can be focusing on the premium phase with the Magic sequence, thus increasing its portfolio throughout value bands,” Pathak mentioned.
“There was additionally a pent-up demand from the loyal Huawei and Honor customers who held on to their units and didn’t swap to different manufacturers. Its sturdy relationships with distributors additionally helped Honor relaunch merchandise on a big scale. Honor’s resurrection will additional intensify competitors within the Chinese language market in H2 2021,” Pathak mentioned.
Honor is focusing on international markets however success there could be tougher to seek out. Its international market share hit 3.7% in August, up from 1.5% in February, however that’s primarily attributable to features in China, Neil Shah, analysis director at Counterpoint Analysis, advised CNBC.
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 lost by Huawei.
“Development outdoors China is more likely to be gradual, as loyalty within the mid-segment stays low and Honor can even should rebuild its distribution community. Then, there are additionally intensifying part shortages which may probably hinder Honor’s enlargement in 2021,” mentioned Varun Mishra, senior analyst at Counterpoint Analysis, in a press launch.
Mishra was referring to the shortage of semiconductors that’s at present affecting industries throughout the board from autos to shopper electronics.