Less than a year ago, Huawei became the world’s largest smartphone maker. Now his rise to power was halted and he had to sell the Honor brand to keep it alive. Reuters now reports that the company is also in talks to sell the flagship Huawei P and Mate series to a Shanghai government-backed consortium.
The discussion has been going on for months, say two anonymous insiders, but no final decision has yet been made. The company still hopes to be able to replace foreign component suppliers with domestic ones, which will allow it to continue producing phones.
The Mate and P series are key parts of the Huawei lineup. For the twelve months between Q3 2019 and Q3 2020, the two lines brought in $ 39.7 billion. In the third quarter of 2020 alone, they accounted for almost 40% of Huawei’s total sales.
The main obstacle at the moment is the shortage of components. Huawei was cut from its main foundry, TSMC, in mid-September. According to insiders, Huawei doesn’t believe the Biden administration will lift the restrictions, so the situation will remain unchanged if the company retains the P and Mate series.
The sale of Honor enabled it to source its chips from MediaTek, Qualcomm, Intel and AMD. In fact, the newly independent Honor’s first phone, the V40 5G, was announced last week with a Dimensity 1000+ chipset.
It was hoped that Kirin’s production could be upgraded to minimum wage, the largest foundry in China. It is already mass-producing a HiSilicon chip on a 14nm process – the Kirin 710A. The next step is the “N + 1” process, should be comparable to 7nm chips (although some reports claim it is not on par with TSMC’s 7nm node). However, the United States put the minimum wage on the “entity list” in December and the foundry faces production difficulties.
A Huawei spokesperson denied that the company is looking to sell its flagship line.
