The Sars outbreak is expected to have a big impact on mobile phone sales in China this year, according to research house Gartner Group.
Gartner has revised down its forecast for mainland handset sales from 65 million units to between 59 and 62 million. It said 55 million handsets were sold last year.
China's domestic handset makers had cut their production by 15 to 20 per cent in the past few months, Gartner said.
Meanwhile, an industry source said mobile phone giant Nokia had cut its monthly output in China by 17 per cent in the second quarter, while Samsung slashed production 30 to 40 per cent.
Ann Liang, an analyst with Gartner's Asia-Pacific mobile communications group, said handset makers around the world were facing mounting inventories due to the unexpected slowdown in demand as a result of the Sars outbreak.
'There is a deepening inventory predicament in China, and there is the economic impact of Sars in the Asia-Pacific region and beyond,' Ms Liang said.
China, which accounted for one-third of global mobile handset sales and about half the Asia-Pacific market, had been most affected by Sars, she said.