Electronics Up, Smartphones down

Electronics production in key Asian countries has been steady to increasing in the last several months. In April 2025, China electronics production three-month-average change versus a year ago (3/12) was 11.5%, up from 9.5% in January but below the average 3/12 of 12% in 2024. India showed the strongest growth, with 3/12 of 15% in March, up from 3% six months earlier. South Korea, Vietnam and Malaysia also showed accelerating 3/12 growth in April.

U.S. electronics production growth has been accelerating over the last six months, with 3/12 growth at 4.6% in April 2025, up from 0.4% in October 2024 and the highest growth since November 2022. Some of this growth in U.S. production is likely due to companies ramping production at U.S. factories as imports are threatened by tariffs. Japan 3/12 has averaged 4.5% in the last three months ended February 2025 after being below 1% or negative for most of 2024. The 27 countries in the European Union (EU 27) showed 3/12 of 2.8% in March 2025 while the United Kingdom (UK) 3/12 was zero in April 2025.

Although China’s total electronics production as measured in local currency (yuan) has shown 3/12 growth of 10% or higher for the first four months of 2025, unit production data of specific equipment have shown different trends. PC unit production 3/12 was 4.2% in April 2025. Although lower than the previous two months, PC 3/12 has been trending up from minus 2% in November 2024. Color TV 3/12 was minus 2.2% in April, a sharp decline from a 3/12 of 12.5% in December 2024. Smartphone unit production 3/12 has been negative since January 2025 after averaging 10% for the months of 2024.

Smartphone imports to the U.S. dropped sharply in April 2025 to 7.6 million units, down 45% from 14 million units in March. Imports from China dropped 61% to 2.1 million units in April from 5.4 million units in March. Imports from India dropped 47% and imports from Vietnam dropped 14%. In April, India ranked first as a source of U.S. smartphone imports at 3.0 million units, followed by Vietnam at 2.4 million units and China at 2.1 million units. Apple has been ramping up iPhone production in India to replace China production. Samsung produces most of its smartphones in Vietnam.

The drop in smartphone imports to the U.S. and the production shift from China to other countries is primarily due to tariffs either imposed or threatened by the Trump administration. The proposed tariffs have been wildly inconsistent. In 2025, President Trump has made the following announcements on tariffs on Chinese imports and tariffs on smartphones:

March 4: enacts 20% tariffs on imports from China
April 2: raises tariffs to 34%
April 9: raises tariffs to 145%
April 11: exempts smartphones from tariffs
May 12: reduces tariffs on China to 30%
May 23: proposed 25% tariff on smartphone imports by the end of June

These trends in smartphone production and imports will soon have a significant impact on the U.S. smartphone market. Counterpoint Research estimated Apple’s U.S. iPhone sales in April-May 2025 were up 27% from a year ago. Counterpoint questions whether the strong U.S. sales are due to consumers buying now due to fears of future tariffs.

Inventories of smartphones in the U.S. are likely to run low soon, resulting in shortages and price hikes. We should see these effects in the next few months.

Also Read:

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