Huawei halts some production lines for its phones after US blacklist

Taiwanese electronics manufacturer Foxconn has stopped some production lines for Huawei phones due to reduced orders for new phones from Huawei, people familiar with the matter told the South China Morning Post (SCMP).

The sources revealed the information on the condition of anonymity. It is uncertain if the decreased production is only temporary or an extended cut. Foxconn declined to comment on the article.

It is common for smartphone manufacturers to tailor their production schedules according to the orders in the near term to meet with projected demand.

At a media briefing on Friday night, Mr Zhao Ming, president of Honor, one of Huawei’s smartphone brands, said the parent brand is closely observing and evaluating the situation after the United States (US) government banned its firms from supplying to Huawei, the SCMP reported.

US chipmakers such as Intel, Broadcom and Qualcomm have reported told their employees not to supply to Huawei until further notice.

In a recent interview with Bloomberg on May 24, Huawei’s founder Ren Zhengfei said that the firm will find its own way to solve its supply chain problems. ‘We will maintain our existing supply chain and will continue to place orders with US companies. But if they can no longer supply us, the portion of our own in-house products will increase,’ he had said.

Mr Ren had called the measures taken by the US as ‘very extreme’. He questioned why a country is taking on a privately-owned firm and attacking it.

‘The US is so powerful, but why are they so scared of us? I think they overestimate Huawei. Such a small company, how come it’s been paid so much attention around the world? I’m excited that we have so much attention, but I think they exaggerate our role in the world,’ the Huawei founder said.

Huawei’s share of global smartphone shipments rose 15.7% in the first quarter of this year, an increase from the 10.5% rise a year ago, data from research house Gartner showed. Huawei lags slightly behind Samsung who currently helms the largest market share, at 19.2%. US’ Apple is the third-largest vendor globally, at a 11.9% share.