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Is Huawei planning to sell its flagship smartphone business?

With mounting restrictions from the US Government, Huawei is said to be in early talks to sell off its premium smartphone business especially its P and Mate series to a consortium. This was revealed by Reuters, citing two sources close to the matter.

According to the report, the Chinese tech giant has been negotiating with a Shanghai government-backed investment firm for months and Huawei has been exploring the possibility of a sale since September 2020. Quoting IDC’s report, Huawei has shipped Mate and P series devices worth an estimated USD 39.7 billion (about RM160 billion) between Q3 2019 and Q3 2020.

The Huawei Mate 40 series was launched in October 2020 and it is said to be the last flagship smartphone to be powered by a flagship Kirin processor. The 5nm Kirin 9000 is the final in-house chip to be produced with TSMC after the US govt had cut off Huawei from its vital supplier. Huawei had also lose access to Google Mobile Services since mid-2019 and it had shipped new devices with Huawei Mobile Services pre-installed.

It is also said that Huawei has yet to make a final decision on the sale and the company is still trying to manufacture new high-end chips in-house. Reuter’s sources also said that the sale is also an indication that Huawei is not optimistic that the US government will change its stance on the Huawei under the new Biden administration.

Huawei denies plans to sell its smartphone business

Shortly after the Reuter’s report was published, Huawei has issued a denial saying that the claims were unsubstantiated. A spokesperson said “There is no merit to these rumours whatsoever. Huawei has no such plan. We remain fully committed to our smartphone business, and will continue to deliver world-leading products and experiences for consumers around the world”.

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Even if the speculations are true, it isn’t clear if Huawei’s smartphone business under a different ownership will change the current situation. Huawei has been repeatedly accused to be linked to the Chinese military which the Chinese tech firm has strongly denied. The new purported consortium is still government-linked and this might be a challenge to convince US authorities that it’s free from China government’s influence.

A couple of months ago, Huawei had sold off its sub-brand Honor to a Shenzhen-based consortium that consists of over 30 agents and dealers. The new independent brand has recently introduced its Honor View 40 but its Google Mobile Services status is still unknown.

[ SOURCE 2 ]

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Alexander Wong