Huawei MateXT: Scalpers Caught in the Crossfire, High Prices Unrelenting, Can Production Ramp-Up Offer Relief?

Tech 2024-09-27 14:40:15 Source: Network

Huawei MateXT: Scalpers Caught in the Crossfire, High Prices Unrelenting, Can Production Ramp-Up Offer Relief?Since its launch, the Huawei MateXT has captivated the market with its tri-fold design and hefty price tag. Numerous "scalpers" caught wind of its potential for profit, snapping up phones at exorbitant prices, hoping to capitalize on the hype

Huawei MateXT: Scalpers Caught in the Crossfire, High Prices Unrelenting, Can Production Ramp-Up Offer Relief?

Since its launch, the Huawei MateXT has captivated the market with its tri-fold design and hefty price tag. Numerous "scalpers" caught wind of its potential for profit, snapping up phones at exorbitant prices, hoping to capitalize on the hype. However, reality has proven harsh, leaving these scalpers with unsold phones and the looming threat of losses. Despite this, the sales end remains steadfast, clinging onto the high price point, as the phone remains in high demand.

Scalpers Stuck, High-Price Buybacks Go Unsought

The tri-fold phone's initial retail price ranged from 19,999 to 23,999 yuan. The day after its launch, prices on the Xianyu platform shot up to 29,000 to 32,000 yuan, with some retailers even asking for 50,000, 60,000, or even 80,000 yuan per unit. While these astronomical prices have vanished, markups of 10,000 yuan remain widespread.

Investigations by Beijing Business Daily have revealed that while many retailers persist in their high asking prices, buyback prices have taken a drastic plunge. Some scalpers have been "played" by distributors, who reneged on promises of buyback at a premium, leaving them with unsold inventory.

Huawei MateXT: Scalpers Caught in the Crossfire, High Prices Unrelenting, Can Production Ramp-Up Offer Relief?

One scalper with three units in stock told reporters that he had purchased his phones from individuals at a markup of 1,000 to 1,500 yuan. If buyback prices continue to drop, he faces the prospect of losses.

High Demand, Markups in Official Channels

The price bubble is largely driven by supply and demand imbalances. Currently, securing a Huawei MateXT through official channels remains a near-impossible feat. Most Huawei flagship stores in Beijing are consistently out of stock. Even those offering units only know their daily supply and arrival times on the day itself.

Online stores are no different, facing "instant sell-outs." On platforms like Taobao, JD.com, and Huawei Mall, users can participate in limited-time flash sales, but online stock often vanishes within seconds.

Some consumers who secured units in previous flash sales are still dissatisfied, as even supposed "official channels" are engaging in price markups. One consumer shared with reporters that he purchased a 512GB black tri-fold phone from the "Huawei Mobile JD Self-operated Store." The original price was 21,999 yuan, but he ended up paying 29,999 yuan, a markup of 8,000 yuan.

Production Ramp-Up: A Solution in Sight?

However, some potential buyers are waiting on the sidelines, opting not to join the scramble. They believe that as production of Huawei's tri-fold phone increases, prices will eventually settle. Renowned analyst Ming-Chi Kuo, in a recent report, indicated that supply chain data suggests Huawei MateXT's 2024 shipment forecast has been revised upwards from 500,000 units to 1 million units.

Industry observer Ding Shaojian believes that any new phone undergoes a production ramp-up process, and initial hype and buzz usually peak at launch, leading to price bubbles.

Experts point out that mobile phone sales rely heavily on the "long tail effect." Once the initial enthusiasm subsides, brand success depends on sustained, steady sales. A phone's popularity is judged by its entire lifecycle, not just short-term sales bursts. Take, for instance, the Huawei Mate60 and X5 launched last year, which have already achieved sales of over 10 million units, a feat impossible to achieve solely through initial hype. The same principle applies to the MateXT.

Moving forward, production of the Huawei tri-fold is sure to increase, but the pace may not be rapid, given the phone's complexity. The MateXT must minimize gaps when folded inwards or outwards, while also enhancing its resistance to compression. In addition to this transformative form factor, it houses a 5600 mAh battery, boasting a capacity twice that of traditional batteries, while maintaining half the thickness. These aspects pose significant manufacturing hurdles.

Typically, when a phone company collaborates with upstream manufacturers, the process involves order placement, progress tracking, and various other steps. During this period, component procurement and product yield by contract manufacturers can fluctuate, putting "change management" skills to the test. Brands must maintain consistent communication with upstream partners, re-confirming delivery quantities and schedules. In other words, the Huawei MateXT is not just a technological pioneer; it also presents a greater challenge in managing supply chains.

Ding Shaojian adds that while production ramp-up for mature phone models can take 2-3 months, flagship phones incorporating new technologies require 4-6 months. The Huawei tri-fold's technical complexity makes it difficult to predict when it will reach stabilization. However, Huawei's long-standing, stable partnerships with upstream manufacturers offer a degree of reassurance. While technological hurdles exist, supply chain partners will strive to meet deadlines as quickly as possible.

Conclusion

The Huawei MateXT's market performance reflects the cyclical nature of new technologies, often experiencing initial frenzy followed by a return to normalcy. Scalpers may be caught in a bind, but high demand continues to sustain high prices. Huawei's ability to ramp up production, meet market demands, and mitigate price bubbles will be crucial in testing its supply chain management capabilities and product competitiveness.

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