It was a remarkable achievement: in the second quarter, Huawei surpassed Samsung and became the top selling smartphone brand. But this leadership position will not hold for long: by 2021, it is forecasted that the Chinese brand will produce much lower numbers of mobile phones than it does in 2020.
Information taken from Korean website The Elec. According to the automaker, the company informed its Korean subsidiary that it plans to produce 50 million cell phones next year.
For Huawei, it is very little. In the second quarter of 2020 alone, the company sold nearly 56 million smartphones. It is forecasted that the company will end this year with production of nearly 190 million units. So why reduce the target by nearly 75% by 2021?
If you think it was because of the trade sanctions Huawei suffered from the US, you are right. Since the company cannot negotiate with US companies, Huawei’s mobile phones no longer leave the factory with the Google ecosystem.
But the biggest limitation concerns the processor. In May of this year, restrictions forced TSMC to stop manufacturing Kirin processors for Huawei. Although TSMC is headquartered in Taiwan, the company still complies with the US Commerce Department’s regulations on the use of US technology in chip manufacturing.
Qualcomm? Impossible: the company is headquartered in the United States. Rumor has it that Qualcomm is trying to get the US government’s permission to supply chips for Huawei’s 5G phones, but if these conversations are going on, then they’re going at a slow pace.
If we take these limitations into account, the output of 50 million devices is an optimistic forecast. The situation is not only worse for Huawei because perhaps, the company still has some spare chips.
In addition, companies like MediaTek may supply processors to Huawei. There is also a lot of expectation that China’s SMIC will produce Kirin chips, even though the company doesn’t have the technology to produce more advanced models.
There is another limitation that could happen here: there are rumors that the United States may also make a decision against SMIC, leaving Huawei in an even more subtle situation.
2021 will be a challenging year for the brand.
With information: Android agency.