Huawei is one of the world's top six smartphone manufacturers in terms of production volume.
Global smartphone production in 2020 fell by 11 percent year-on-year to 1.25 billion units.
This year TrendForce expects to increase by 9 percent to 1.36 million units, as people replace older devices and demand grows in emerging markets.
But even this slight recovery depends on how the epidemic continues to affect the economy and the global shortage of chips, which is currently delaying production across almost the entire electronics industry.
The first six smartphone brands by volume in 2020 were Samsung, Apple, Huawei, Xiaomi, Oppo and Vivo.
This year, however, TrendForce expects Huawei to exit this arrangement, with the top six smartphone brands including Samsung, Apple, Xiaomi, Oppo, Vivo and Transsion.
These six companies are expected to account for 80 percent of the global smartphone market in 2021, while Huawei ranks seventh.
Huawei's decline is mainly due to the sale of its limited-budget smartphone brand, Honor.
Huawei confirmed in November that it was selling Honor to a group of companies to save Honor from the impact of U.S. government trade restrictions.
The aim of the offer was to protect Honor from sanctions that harmed Huawei's business.
TrendForce said: We must see the possibility that the new Honor company will attract consumer attention without Huawei's support, and Huawei may compete directly with Honor in the future, especially if Huawei is free from U.S. trade sanctions.
In an earlier report released shortly after The Honor's sale was announced, TrendForce predicted that the deal, along with the global shortage of chips, meant that Huawei could capture only 4 percent of the market in 2021, compared with 17 percent in 2019 and 14 percent in 2020.
Apple is expected to capture some of the market share of Huawei's advanced smartphones, while also benefiting Xiaomi, Oppo and Vivo.
TrendForce expects Honor to gain 2 percent of market share in 2021.
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