The value of the European smartphone market could as much as halve this year due to the economic recession, according to the latest estimates from IDC. Its most pessimistic estimate of the impact of the Covid-19 crisis is a 47 percent fall in the value of the market, while the most probable scenario is a 27 percent drop, the market researcher said. In November 2019 it was still forecasting growth of 2.7 percent this year.
The sector will suffer from the lockdowns imposed around the continent to contain the coronavirus as well as growing unemployment in the aftermath. The supply constraints seen in the first quarter have largely disappeared, while the new issue is collapsing demand. The biggest impact is expected in countries such as Italy and Spain, the places hardest hit by the crisis, but under IDC's probable scenario it expects nearly all European markets to drop by around a fifth.
This will be the sharpest reversal the phone industry has ever seen across Europe in the 20 years IDC has been monitoring the sector. During the last major recession, the European phone market value fell by 6.3 percent in 2008 and 13.1 percent in 2009 in dollar terms. Europe's GDP contracted more than 4 percent in 2009, and the latest forecasts suggest the contraction this year will be twice that rate.
