Smartphone manufacturers are cutting back and the son is changing course
Hi, this is Akito Tanaka from Singapore. Here, the various constraints associated with Covid are finally easing, and life is gradually beginning to return to what it was before the pandemic. The Covid contact tracking app, one of the most used smartphone apps among Singaporeans during the pandemic, is gradually coming to an end. Wearing masks outdoors is now optional – especially welcome change, given the endless summer of the city-state.
But elsewhere Covid is still shaking up the tech industry and giving fresh reminders of how cheap supply chains can be.
All three of China’s leading smartphone makers are cutting back on their suppliers’ orders in response to falling consumer confidence and supply chain turmoil caused by the Covid blockade in and around Shanghai, writes Nikkei Asia’s Chen Ting-Fan and Lovely Lee.
Xiaomi, the world’s third-largest smartphone maker after Samsung and Apple, initially targeted 200 million units this year versus 191 million units the previous year. Its target now ranges from 160 million units to 180 million units. Oppo and Vivo also cut orders by about 20 percent in the coming quarters
Apple, which relies on its extensive and sophisticated supply chain to China, has already cut orders for its budget iPhone.
If there is one winner in the current turmoil, it is Samsung, the world’s largest smartphone maker, whose supply chains are mainly in South Korea and Vietnam. Its much smaller exposure in the Chinese market has also protected it from falling consumer confidence there.
Gloomy sentiment and inflationary worries these days can be found all over the world, but, as one analyst says, “Most of the slowdown is really coming from China.”
When TerraUSD broke the peg to the dollar, not only digital token holders were worried, Nikkei Asia Vataru Suzuki reports.
TerraUSD is a so-called stablecoin, a token pegged to the fiat currency, which acts as a bridge between the traditional financial system and the cryptocurrency ecosystem. The failure of Terra and the lesser fear of Tether, another stablecoin, prompted crypto traders to question their investments in everything from bitcoin, the largest and oldest cryptocurrency, to smaller coins. It could also give a new impetus – and ammunition – to regulators to bring down the cryptocurrency industry.
The son begins to defend himself
SoftBank billionaire founder Masayashi Son was not looking for excuses when he announced a historic investment loss of 3.5 trillion yen ($ 27 billion) for the full year in his Vision Fund, writes the Financial Times. Anthony Sladkowski.
Instead, as if trying to stay ahead of bad headlines, he admitted that the investor was worried about his missed rates and SoftBank’s financial position. He stressed that the company is restoring the focus on financial prudence and spoke of a new, more cautious phase for the conglomerate.
To make sure of this, the first slide in his presentation featured a huge Chinese character: “mamori” or “defense”.
“If the world is a mess, SoftBank must play defense,” Son told reporters gathered at the company’s new seaside headquarters in central Tokyo.
The Vision Fund’s losses plunged its conglomerate as a whole to the largest-ever quarterly net loss of 2.1 trillion yen. Holdings have suffered from rising interest rates and Beijing’s repression of the technology sector.
Some analysts were surprised to hear the SoftBank leader talk about being more cautious with investing and holding due diligence.
The dream also said it would slow investment in China, where SoftBank has high risk through a 25 percent stake in Alibaba, which is directly owned. The e-commerce group, owned by Jack Ma, is under increasing pressure from regulators.
Now, with a bad quarter in the rearview mirror, the focus has shifted to the road ahead: how else can SoftBank raise money and reassure investors?
If the price is correct …
Honda has just released its first electric car of its own brand for China, the world’s largest EV market. The Japanese car giant is trying to introduce the thread into the needle in a market dominated by Tesla in the highest class, and in the more affordable – many local manufacturers, writes Nikkei’s Takashi Kawakami.
Prices for the new Honda SUV, e: NS1, will start at the equivalent of about $ 26,000 including subsidies. It comes with a range of 510 km, powered by a Chinese battery manufacturer CATL.
Historically, most Japanese automakers have relied heavily on hybrid car technology, and now they are lagging behind their European, American ones. and Chinese competitors in the EV market. Honda is no exception. To catch up, Toshihira Mibe, who took over as CEO last year, has promised that by 2040, all new vehicles that Honda is launching will be either electric or fuel cell.
This is a bold promise, and even more surprising given that Honda’s global reputation is largely based on its prowess as an engine manufacturer. It will also face stiff competition in the Chinese EV market, where oversupply is already becoming a problem.
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JPMorgan upgrades Chinese stocks that have recently been declared “unfit for investment” (FT)
Foxconn eclipses rivals hit hard by blockades in China Covid-19 (FT)
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Tencent’s revenue is not growing for the first time since the 2004 IPO (Nikkei Asia)
Coordinates #techAsia by Catherine Krill of Nikkei Asia with the help of the FT Technical Department in London.
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