Not only Europe: Chinese smartphones are becoming more and more popular in Russia, thanks to more competitive prices than the typical “Western” brands. However, the conflict in Ukraine is having serious repercussions on the eastern economy: this is demonstrated by the list of companies that have promptly abandoned the nation and the boom of VPNs to circumvent government blockades. Meanwhile, the repercussions are starting to be felt also for brands such as Xiaomi, OPPO and Huawei, companies that can no longer operate as they did before February 24.
As reported by sources close to the sector, smartphone shipments by Xiaomi, OPPO and Huawei would be registering a significant drop of -60%. The reason would be found in the collapse of the ruble: due to the heavy sanctions of the NATO front against Russia, the national currency would have rapidly lost much of its value. In the space of a few weeks, the ruble/dollar exchange rate went from around 0.014 to a minimum peak of 0.0072, a dynamic that we find also reflected in comparing it with the yuan (the Chinese currency). Meanwhile, Transsion Holdings (the company that controls Infinix and Tecno ) has announced that it will begin operating transactions in yuan to avoid further collapses.
The risk for foreign companies, including Chinese smartphone brands, is to go at a loss due to the extremely disadvantageous exchange rate. For this reason, the triptych composed of Xiaomi, OPPO and Huawei would have decided to cut so massively the shipment of products to Russia.
While Apple, Samsung and Nokia have publicly announced that they have stopped sales in Russia, Chinese companies continue not to expose themselves. But there is no doubt that the repercussions are affecting them, also because we are talking about companies that are very popular in Ukraine and which, due to the conflict, find themselves deprived of a strategic country for Eastern Europe.
As stated by a former Xiaomi executive, it would be ” politically sensitive to openly announce a suspension of sales in the Russian market “. In the scenario of opposing Russia and Ukraine, China does not take a clear direction in either direction. Meanwhile, Andrew Cahn and Ken Olisa, directors of Huawei Europe, have resigned in protest of Huawei’s lack of pro-Ukraine statements.