Is the global secondary mobile market panicking? Prices drop faster than expected

Seasonal pressure impacts inventory and pricing

Price drops in December are not uncommon, as retailers aim to minimize inventory levels before the year's end. Devices shipped after December 15 are unlikely to reach shelves in 2024, creating urgency to clear stock well before. Additionally, trade-in volumes of Apple’s iPhone 16 have hit the market, further increasing supply. However, the recent rapid decline surpasses normal seasonal adjustments, signaling deeper issues.

Uncertainty from Europe’s USB-C directive

A major factor driving price declines is Europe’s USB-C directive, which imposes an import ban on non-USB-C devices starting 28 December. Traders are rushing to sell non-compliant devices, flooding the market and pushing prices down. Although enforcement details remain unclear, the looming deadline has created uncertainty, particularly for companies reliant on exports.

Black Friday sales disappoint

Expectations for Black Friday sales were low, but the actual performance contradicted the pessimism. Secondary mobile market suppliers, anticipating holiday demand, increased inventory before the season as they normally do. When demand looked like underperforming, they started to dump products. Result: oversupply led to significant price drops.

Anticipation for the Apple iPhone SE 4

The upcoming Apple iPhone SE 4, expected in Q1 2024, is influencing the secondary market. While the SE 4 is positioned as an affordable entry-level device, its expected launch has led to increased supply in anticipation of falling prices.

Regional differences and the vicious cycle

Price declines were first observed in the U.S., with other regions now catching up. This global trend has created a vicious cycle: falling prices lead companies to offload inventory quickly, further increasing supply and driving prices down. Experts predict this cycle may persist into early January.