Handset production falls drastically

Local mobile handset production has seen a sharp fall by 8.59 lakh in July compared to the previous month, according to the latest data of Bangladesh Telecommunication Regulatory Commission (BTRC).

All 14 local manufacturers who are currently in operation produced 20.36 lakh handsets in July, the lowest in 2022, which was 28.95 lakh in June, meaning that the production has fallen by 29.67 per cent.

Of the total produce, 14.47 lakh handsets were 2G-enabled feature phones and 4G-supported smartphones stake 5.89 lakh. No 3G-enabled feature phone and 5G-powered smartphone was produced in the month.

According to the data, out of the total production, 71.06 per cent were feature phones and 28.98 per cent were smartphones.

Only in the month of July in the current year, no 5G-enabled smartphone was produced while 32,000 units of the super speed technology enabled smartphone were produced in the previous month.

Md Omar Faruk, CEO of feature phone manufacturer Al Amin Brothers, said low sales in market triggered this fall. The present inflation and dollar price hike have impacted the handset industry, though the basic phone segment is less impacted as affordability of the people is not that much stable.

“Due to the dollar price volatility, we are also facing losses and struggling to set a specified price,” he added.

“The fall both in sales and production started from April, especially smartphone sales received a hit compared to the same span in the last year,” said Mohammad Mesbah Uddin, chief marketing officer of Fair Electronics, Samsung’s local assembling and manufacturing partner.

“The manufacturers are not producing at their previous rate as the costs of production have surpassed the affordable sales price and it is becoming tough to synchronise between manufacturing costs and selling prices in the market,” Mesbah added.

The BTRC data also showed that only 70 5G-supported smartphone handsets, and no feature phone, were imported in July.

The importers had imported 42,800 handsets in June. Of those, 42,700 were feature phones and 100 were smartphones.

Compared to the other months of 2022, handset manufacturing at local factories reached its peak in January, with 41.45 lakh handsets — 27.54 lakh feature phones and 13.68 lakh smartphones — produced in the month.

Locally assembling factories started catering to the country’s handset market during the last 4/5 years, after the government offered many tax and duty benefits for the local producers in an effort to boost investments in the sector, help the country save foreign currency and create much needed employment.

Currently, there is a 57 per cent tax on imported smartphone and 32 per cent for basic and feature phone – while tax on locally-assembled and manufactured handset is 18 and 13 per cent respectively.