Huawei’s Plan for the U.S. Blacklisting? Hoarding

Posted on June 5, 2020 by Paul Thurrott in Cloud, Hardware, Mobile with 11 Comments

A new report claims that Huawei has stockpiled up to two years’ worth of critical U.S.-based chipsets and components.

According to Nikkei Asian Review, the stockpiling designed to protect Huawei during a unilateral crackdown of the company by the U.S. government. It includes the “most essential components” it will need—mostly Intel and AMD chipsets for servers and Xilinx programmable chips—for its operations to last between one and a half and two years. Separately, we know that Huawei was also stockpiling NAND flash memory chips from Kioxia, Micron, Samsung, and SK Hynix.

This stockpiling began at the end of 2018, the report claims, right after Huawei CFO Meng Wanzhou was arrested in Canada. Huawei “is preparing stocks for wartime,” one of Nikkei’s sources told the publication.

Huawei has acknowledged stockpiling hardware components in the wake of the most recent U.S. action, noting that it spent $23.45 billion in 2019 on the effort. But it has never specified which components it was buying up, nor the methods by which it does so. Nikkei says that the firm is obtaining the components through chip distributors and traders, and via its partners.

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Comments (12)

12 responses to “Huawei’s Plan for the U.S. Blacklisting? Hoarding”

  1. harrymyhre

    Doesn’t make sense because the stuff they are stockpiling will be “ancient” in six months and nobody will want it.

    • peterc

      In reply to Harrymyhre:

      Mid to Low range handsets for home based market and Indian consumption, whilst they complete their "2025 self-reliance" manufacturing supply chain.

      SMIC, Chinas emerging semiconductor manufacturer just raised $2.8 billion to invest in and expand its operations over the next 2 years...... coincidence?

      Its a tall order though for SMIC, they've got some manufacturing refinements and quality issues to overcome, but I simply would not bet against the Chinese pulling this off - their high tech manufacturing capabilities are remarkable and they are nothing but determined to achieve self reliance now, and their home market size allows them the growth market to do so.

      This was all so avoidable and unnecessary.

    • wunderbar

      In reply to Harrymyhre:

      Chinese market very different than the western market. That likely matters a lot less over there. And they can also transition those parts into budget or midrange products. 2019 high end is 2020 and 2021 midrange.

    • webdev511

      In reply to Harrymyhre:

      Not everything in a smartphone needs to be this year's design. There are some core components that are better had up to date, but given they are also building their own OS (from AOSP?) they can compile based on what's in the devices? I guess?

  2. bluvg

    Regardless of security concerns, this is going to backfire on the US. It only accelerates China's trajectory to make everything themselves.

  3. illuminated

    So US blacklisted Huawei but other Chinese companies are fine. That is at the same level of stupid as banning EU flights but allowing UK flights back when pandemic started. It is all for show. Very expensive show.

  4. youwerewarned

    Don't worry, they got the "special" chips so we can spy on them spying on us spying on them.

    That's what I call efficient!

  5. chrisltd

    I had no idea they copied the Apple Store interior design

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