So far, the Hungarian mobile market has performed very well in 2022. There is no tendency among customers to buy cheaper phones yet, but could it happen in the near future?
Tibor Wagner, the country manager of Xiaomi in Hungary gave an interview to Pénzcentrum, in which he analysed the way the domestic prices of products may have changed following the dramatic weakening of the forint.
Due to the weak forint exchange rate, it is highly unlikely that the prices of mobile phones will decrease. According to Tibor Wagner, they work with recommended consumer prices and their distributors are exposed to exchange rate risk. The distributors try to correct the deterioration of the exchange rate to the appropriate extent. As long as possible, the company is trying to balance the deterioration of the exchange rate using this method, but there is a limit. However, the Hungarian manager of Xiaomi emphasised that it was always the last step that the customers experienced the price increase directly.
In September 2019, Xiaomi was officially launched in Hungary. Since then, the company has become successful in the Hungarian smartphone market. In the year of launch, Xiaomi had a 3 percent share of the Hungarian smartphone market, which became 20 percent by the end of 2020, and then in the middle of 2021, it was close to 30 percent. According to Tibor Wagner, Xiaomi is not the strongest in the cheapest category, but rather in the middle and upper-middle segments. These are typically the latest products of the Redmi Note series, currently the Note 11 and Note 11 Pro.
Although inflation had been rising in Hungary, people did not settle for cheaper mobile phones, said the Hungarian manager of Xiaomi. “Compared to last year, we even sell a little more of the expensive, high-end products”, he added. “Hungary is a particularly favourable European market from the company’s point of view because the majority of customers do not go for the cheapest category but the segment in which Xiaomi is very strong.” – says Tibor Wagner.