China’s home appliance industry saw revenue down by 26.39% year-on-year to 248.01 billion Yuan, and profit down by 44% to 11.3 billion Yuan from January to March 2020, of which refrigerating sector plunged by 17% in sales growth and 40.6% in profit growth, air conditioner sector 31% and 41.36% respectively, kitchen appliance sector 26% and 46.88% respectively, according to National Bureau of Statistics.
Domestic output of large home appliances dived from January to March 2020, shrinking by 20% on average.
Most home appliance players suspended or cut down on production in February due to the outbreak of coronavirus and gradually resumed production starting March, which lead to a rally of output in March.
Home appliance sales from domestic market fell by 37.6% year-on-year for Q1 2020, according to All View Cloud.
As we learn from enterprises, offline sales has been gloomy in Q1. Affected by the lockdown of cities, some categories plunged by 70%-80% in offline sales; large appliances including refrigerator, washing machine and air conditioner dived by more than 40% in offline sales though the online sales were not as bad.
It’s worth noting that, online sales of some portable appliances experienced a small rise. The trend of home cooking during the outbreak drove up the sales of portable appliances which do not need installation and are easier to deliver. Plus, portable appliance makers adopted a number of innovative modes such as live streaming sales with internet celebrity to release and promote products amid the outbreak as a way of expanding consumer base.
As domestic market gradually recovers from the outbreak, domestic sales of home appliances has been rallying, but at a slow pace due to the reports of several new cases in some places. It is forecasted that domestic sales could fall by around 20% in Q2, and 15% for the whole year.
Exported home appliances from China posted value of 14.68 billion USD from January to March 2020, down by 12.8% year-on-year. For March alone, the export value went down by 0.6% year-on-year to 6.26 billion USD, according to General Administration of Customs. As to the imports, imported home appliances to China posted value of 1 billion USD for Q1, up by 0.8% year-on-year, creating a surplus of 13.68 billion USD, down by 13.7% year-on-year, according to General Administration of Customs.
When it comes to exports to main countries and regions, exports to the EU fell by 13.4% year-on-year by value, the first fall in four years; exports to Asia fell by 6.1% year-on-year by value, the first fall in eight years; exports to the ASEAN stood out with a rise of 13.5% year-on-year by value; exports to North America dived most with a fall of 24.2% year-on-year by value, according to General Administration of Customs.
The late delivery of overseas orders in February caused by the sudden outbreak of coronavirus and the following extended holiday led to a fall in exports in February. Entering March, industry players gradually resumed production and prioritized overseas orders when domestic market was suffering from the epidemic. In late March, coronavirus spread globally. Main overseas markets stepped up prevention and control measures starting April. The exports of home appliances from China is forecasted to face pressure in April and May.
Statistics from 2019 showed that, annual exports of home appliances from China posted 70.9 billion USD, of which North America accounted for 23% with 16.5 billion USD, Europe accounted for 26% with 18.8 billion USD, and Japan 9% with 6.4 billion USD. The three regions/country took a combined share of more than 50%. Currently, they are all hard hit by coronavirus. The optimistic estimate would be a 30% fall or plus for Q2 and 20% fall for the whole year given the influence of the pandemic.
China’s home appliance industry faces big pressure. Based on the current situation, it is forecasted that the yearly domestic sales would fall by around 15%, exports fall by around 20% and the overall performance fall by 15%-20%.