Trump’s Latest Move Takes Straight Shot at Huawei’s Business

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Huawei also got a stark demonstration of the power Washington wielded over it.

The company has since stockpiled components “for uncertain times,” Guo Ping, a Huawei deputy chairman, told reporters in March. The firm has also worked to build up a geographically diverse network of suppliers, Mr. Guo said.

“Huawei has made sustained and deep investments over the past 30 years, and I believe that has been of great help to Huawei’s global supply,” he said.

In particular, the company has invested for many years in producing its own microchips, a key area in which most Chinese firms are laggards. Sravan Kundojjala, an analyst based in Hyderabad, India, with the technology research firm Strategy Analytics, estimates that three-quarters of the smartphones that Huawei ships today contain chips developed in-house.

Mr. Kundojjala acknowledges that he was skeptical when Huawei’s semiconductor unit, HiSilicon, began building its own high-end smartphone chips.

“Initially, I thought this was not going to work out,” he said. “It’s maybe a pet project. Maybe they just want to play games with their suppliers.”

Instead, HiSilicon has become a formidable asset for Huawei, with chip technology that analysts say rivals that of market leaders such as Qualcomm.

Yet Huawei still depends on American suppliers for enough critical components that an all-out export ban from Washington would create a sizable headache, even if it does not lead to near-ruin as it did for ZTE.

“When you’ve got something as complicated as a router or a cellphone, even if there’s one part you’re not able to get, you can’t deliver, because you don’t have that widget to make the cellphone or router function,” Mr. Wolf, the lawyer, said.




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