The Chinese smartphone OEM Huawei has long harbored ambitions to surpass Samsung as the largest smartphone maker, and it did, for a while at least. However, unfortunately, the company will not be able to retain its position anymore. Despite the US trade ban that started in May last year, the company kept afloat and managed to sell more Smartphones as compared to Samsung amidst the pandemic.
Based on a recent report by the elec, a state-backed Korean news agency, Huawei plans on producing only 50 million smartphones in 2021. This represents a massive 74 percent drop compared to what the company is expected to ship this year. Last year it managed to ship 240 million units, and this year, Huawei is expected to sell 190 million units.
The main reason behind such a massive reduction in smartphone production is the expanding scope of the US trade ban that has made it almost impossible for the company to continue making phones.
Huawei was going neck and neck with Samsung till last year. However, the lack of Google services put off many consumers worldwide. Now TSMC, which makes the bulk of Huawei’s smartphone chips, will also stop taking orders from the company and it can’t buy chips from Qualcomm either as it’s an American company. These are some of the reasons Huawei cannot manufacture enough smartphones going forward.
For now, the company is relying on SMIC to produce budget Kirin chipsets that can be used in entry-level and mid-range smartphones. However, to cripple Huawei further, the US is working on banning SMIC from trading with Huawei as well. If the ban goes through Huawei will practically have no access to chipsets for its smartphones and the brand’s smartphone business will be in dire straits.