Huawei is planning a comeback in the smartphone market later this year, focusing on 5G phones. Advances in the development and manufacture of 5G chips in China have made this possible. Under the Trump administration, the US issued export bans, including technology sales to Huawei and Chinese chip manufacturer SMIC. As a result, Huawei, once the second-largest smartphone manufacturer in the world, could no longer produce 5G phones and faced a decline in market share.
However, the slump in Huawei’s smartphone business was not solely due to the US sanctions. The COVID-19 pandemic and Huawei’s decision to outsource a significant part of its smartphone production also played a role. The company’s subsidiary brand, Honor, has been operating independently since 2020.
Huawei and SMIC have been working together on the development of domestic production of 5G chips since the US sanctions were imposed. According to three Chinese sources, production of these chips is set to begin later this year.
The US initially made exceptions to its export ban, issuing export licenses related to Huawei and SMIC. However, these exceptions did not apply to 5G technology. In April 2021, President Joe Biden stopped these exceptions, fulfilling a demand made by Republicans. This change in policy also takes into consideration Huawei’s expansion into other business areas.
Despite the challenges, Huawei is determined to make a comeback in the smartphone market with its upcoming 5G phones. It remains to be seen how successful their efforts will be, especially given the ongoing competition and geopolitical tensions in the global smartphone industry.
