Huawei remains resilient amidst the American embargo

For several years, Huawei has been the target heavy US restrictions. Suspected of spying on the United States thanks to its equipment and of having wiretapped their military bases, the Chinese company saw itself private semiconductors and manufacturing equipment essentials in the development of its products. To bounce back, Ren Zhengfei, its founder, said on February 24 that Huawei had to proceed replacement and modification of thousands of components and printed circuits.

Rethinking your production chain

During his speech, transcribed and published on March 17 by Jiao Tong University in Shanghai, the leader of Huawei indicated that the production of printed circuit boards has stabilized because we have a reserve of locally made components “. Over the past three years, 13,000 American components were exchanged by semiconductors produced by Chinese manufactories and 4,000 printed circuits for its devices have been redesigned. According to several sources, Huawei would have the ambition to create a new supply chain to double its production semiconductors over the next two years.

He said the Chinese juggernaut has invested $23.8 billion in research and development in 2022. « As our profitability improves, we will continue to increase our R&D spending “, he confided, “ we are still in a difficult period, but we did not stop on the way to progress “. In 2022, with a turnover of 86 billion eurosthe group moved slowly, but surely, to stabilize their income.

He added that China still faces “ difficulties in producing electronic chips » and that she should « find other ways to catch up “. China imports more chips than oil, a weak point exploited by Washington. In October, the United States drastically cracked down on the export of chips and equipment to manufacture them and pressured its allies to deprive the Middle Kingdom of these components.

Towards a hardening of the “Entity List”

Through his speech, Ren Zhengfei expressed his sorrow over the restrictions initiated against his company by the Trump administration in 2019. The 78-year-old Chinese entrepreneur, who calls himself a supporter of Western technology, explained not knowing how to react when his company was placed on the Entity List. This is the Department of Commerce blacklist. Being registered there means the need to obtain a license to acquire products from American companies.

Alongside Huawei, the symbol of US sanctions, 600 other Chinese companies are listed there today. If Huawei was able to obtain a certain number of licenses for a while, in particular to trade with Intel and AMD, the situation could change. Under pressure from Republicans, the Commerce Department could be more restrictive on licensing. Huawei risks losing its last American partners. Despite this latest blow to his business, Ren Zhengfei still believed not to be ” anti-occidental » during his speech.