Memory Shortage Forces Xiaomi and Transsion to Slash Smartphone Production Targets.

Chinese Smartphone Makers Revise Supply Plans

According to Novyny.live: Major Chinese smartphone manufacturers, including Xiaomi and Transsion, are scaling back their supply targets for 2026. This strategic shift is a direct response to a global memory chip shortage, which has driven up the cost of key components like DRAM. This component inflation is expected to lead to higher smartphone prices for consumers in the coming years.

Xiaomi has significantly reduced its 2026 shipment forecast, cutting it by a range of 10 to 70 million units from an initial target of 180 million smartphones. This adjustment highlights the severe supply chain pressures facing the industry as companies scramble to adapt to the new market reality.

Similarly, Transsion has lowered its annual target by 30 to 45 million units, down from an original plan of approximately 115 million. These parallel moves underscore the widespread nature of the challenge, compelling manufacturers to demonstrate flexibility in production management.

Analyst Forecasts and New Strategic Directions

In December, IDC analysts downgraded their global smartphone market forecast, anticipating a sales decline of 2.9% to 5.2%. Given these trends, the DRAM shortage is projected to cause a substantial increase in smartphone prices by 2026. To navigate these headwinds, manufacturers are considering a return to equipping budget models with 4GB of RAM, a move seen as a potential strategy to maintain market competitiveness and affordability.

The smartphone market's struggles reflect broader global economic trends where component scarcity and rising raw material costs disrupt manufacturing. This environment forces strategic pivots that could reshape consumer preferences and intensify competitive dynamics in the tech sector.

• Xiaomi's reduced shipment forecast
• Transsion's lowered supply target
• Anticipated 2.9-5.2% drop in global sales
• Potential reintroduction of 4GB RAM in budget phones

This potential shift to less powerful configurations signals a concerted effort by companies to keep their products accessible amidst rising production costs, even if it means scaling back on specifications.