Trade dispute: Huawei are running out of smartphone chips

The Mate 40 is likely Huawei’s last smartphone with its own Kirin chip. According to Huawei, there is currently a lack of chips and suppliers. Qualcomm is trying to get an exemption for chip deliveries to Huawei.

Huawei apparently has problems with the procurement of smartphone processors. According to the company, the current US trade sanctions mean, among other things, that Huawei’s partner has to stop production of its own Kirin SoCs. “We have no chips and no suppliers,” said Richard Yu, head of Huawei’s consumer division, according to a report by the Associated Press.

Huawei Kirin 990 5G (Image: Huawei)According to him, production of the Kirin processors will end on September 15, as Huawei only develops the chips, but does not manufacture them itself. The trade sanctions tightened in May are forcing Huawei’s suppliers not to accept any new orders from the electronics company since mid-May. They are only allowed to process existing orders until September 15th.

“This year may be the last generation of Huawei Kirin high-end chips,” Yu said at the China Info 100 industry meeting. “Huawei’s upcoming Mate 40 smartphone, slated for September, could be the last phone with a Kirin chip . “

Yu expects that Huawei will ship fewer smartphones this year than last year as a result. In 2019, Huawei reported sales of 240 million units. However, the manager left open how much sales could collapse.

The US is accusing Huawei of equipping its network infrastructure products with back doors following instructions from the Chinese government. Huawei always denies the allegations. Security researchers have also not been able to provide any evidence for such backdoors. Nevertheless, it is not only the USA that is excluding Huawei from setting up 5G networks – mostly under pressure from the United States.

The trade sanction is directed not only against Huawei’s telecommunications equipment business, but also against the consumer division. For example, certain US technologies are generally not allowed to be supplied to Huawei – the US government is also using the order against companies outside the US by threatening them with sanctions. Among other things, TSMC then announced that it would bow to the specifications from Washington that it would use US technologies for its production.

In the first half of the year, however, Huawei was able to successfully defend itself against the trade sanctions and the corona crisis. Huawei also reported losses, but for the first time the company delivered more smartphones than the long-standing industry leader Samsung.

Huawei recently received support from Qualcomm. The US company called on the US government over the weekend to relax its export regulations for Huawei and allow the sale of chips for 5G smartphones to Huawei.

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