China Ceded 2019 Smartphone Share to Vietnam, but Stayed Dominant, US Imports Show

The proportion of smartphones imported from China dropped from almost 80% to just under 75% last year, according to government data, at the same time total imports fell 1.7%.

Vietnam gained stature in 2019 as an alternative country of origin to China with the Dec. 15 threat of 15% List 4B Section 301 tariffs on Chinese smartphones looming for much of the year’s second half. U.S. importers took delivery of 40.54 million smartphones from Vietnam in 2019, a 71.2% increase from a year earlier. Vietnam was the source for 18.9% of all smartphone imports to the U.S. last year, a gain of 8.1 percentage points from 2018. The average Vietnamese smartphone was worth $214.22 in customs value, 18.3% cheaper than in 2018, and 20% less costly than the average 2019 Chinese counterpart.

U.S. importers sourced 214.6 million smartphones from all countries last year, according to Census Bureau figures accessed through the International Trade Commission’s DataWeb tool.

Chinese sourcing was down 5 percentage points from 2018 as a share of total U.S. smartphone imports, DataWeb said. But there was no abandoning China on the scale of the TV supply chain’s exodus to Mexico to escape List 4A tariff exposure (see 2002100011). The Trump administration postponed List 4B indefinitely Dec. 13, less than 48 hours before the tariffs were to take effect on smartphones and other consumer tech goods, after the U.S. reached its phase one trade agreement with China.

China sent 160.13 million smartphones to the U.S. last year, 7.9% fewer than in 2018, DataWeb said. Chinese handsets were 74.6% of 2019 imports from all countries, compared with a 79.6% share in 2018. The average 2019 Chinese phone was worth $268.90 in customs value, 2% higher than in 2018.

China and Vietnam together were 93.5% of all smartphone imports to the U.S. in 2019, DataWeb said. Small quantities from India, Malaysia, Mexico, Singapore, Taiwan and Thailand were the bulk of the remaining U.S. supply. Shipments from those countries collectively declined 5.2% last year to 4.07 million handsets, though imports from India increased 26.4% to 666,500.

Q4 smartphone unit imports to the U.S. from all countries declined 4.7% from Q4 a year earlier to 61.82 million, but increased 14.9% sequentially from Q3, DataWeb said. Q4 Chinese shipments increased 21% from Q3 to 47.67 million handsets, but were down 9% from 2018. China was the source of 77.1% of Q4 smartphone imports to the U.S., compared with 80.7% a year earlier.

U.S. importers sourced 11.28 million smartphones from Vietnam in Q4, a 47.9% increase from 2018, but a 0.8% decline sequentially from Q3, DataWeb said. Vietnam was the source of 18.2% of Q4 smartphone imports to the U.S., compared with 11.7% share a year earlier.

Vietnamese smartphone imports to the U.S. trended significantly more toward the lower end in Q4, DataWeb said. The average Vietnamese import was worth $146.35 in the quarter, a 43.2% decline from Q4 a year earlier. The average Chinese phone, worth $307.60, was 52% costlier than its Vietnamese counterpart.

December smartphone unit imports to the U.S. from all countries declined 14.1% sequentially from November to 18.14 million and were down 0.1% from December 2018, DataWeb said. U.S. importers sourced 14.18 million units from China in December, 8.8% fewer than in November and 1.6% fewer than a year earlier. December imports from Vietnam declined 35.2% from November to 2.96 million, but increased 37.8% from a year earlier.

Vietnam’s rise as a smartphone sourcing country was unmistakable from the DataWeb numbers, but so was China’s ability to retain share, even with the List 4B tariff threat looming. China dipped to 73.7% of November smartphone imports to the U.S. from 79.5% in October as Vietnamese shipments surged in November to a 21.6% share from 16.7% in October. But China’s December share recovered to 78.2%, just 1.2 percentage points lower than in December 2018, when smartphone tariffs weren’t yet in the picture.