Huawei Replaces Thousands Of U.S.-Banned Parts In Its Products
Huawei Technologies Co Ltd said it has replaced more than 13,000 parts in its products that were hit by U.S. trade sanctions, quoting a transcript of a speech posted by a Chinese university. This move may fuel demand if its chips are on par with US-made ones — rendering sanctions ineffective.
According to the transcript posted by Shanghai Jiao Tong University, Huawei founder Ren Zhengfei said Huawei had over the past three years replaced the 13,000 components with domestic Chinese substitutes and had redesigned 4,000 circuit boards for it products. He said production of circuit boards had “stabilised”.
The remarks, which Reuters could not independently verify, provided a window into Huawei’s efforts to bounce back from U.S. trade restrictions. Since 2019, Huawei, a major supplier of equipment used in 5G telecommunications networks, has been the target of successive rounds of U.S. export controls.
Those controls cut off both Huawei’s supply of chips from U.S. companies and its access to U.S. technology tools to design its own chips and have them manufactured by partners. The Biden administration last year also banned the sale of new Huawei equipment in the U.S.
Ren made the remarks in a talk to Chinese technology experts on Feb. 24, the university said. The university posted the transcript on its website on Friday. A U.S.-based Huawei representative did not immediately respond to a request for comment on Friday.
Nonetheless, it is known that Huawei’s products are still sold in the United States through third party retailers — a sign that Huawei has somewhat cemented its position in the country with quality products notwithstanding the prevailing geopolitical tensions.
Ren said Huawei invested US$23.8 billion in research and development in 2022, and “as our profitability improves, we’ll continue to increase R&D spending.” The founder said the company had built its own enterprise resource planning system, called MetaERP. To launch in April, it will help run its core business functions, including finance, supply chain and manufacturing operations.
On defending its premium position in the US market, Huawei’s move in developing its own parts can only strengthen its position domestically and globally. The icing on the cake is its successful weaning off its reliance on US-made Qualcomm chips. Should the chips turn out to be on par with that from Qualcomm, it will continue to fuel demand with or without the sanctions.
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