To show just how hard the U.S ban is on Huawei, the company recently notified its suppliers that they should expect a sixty percent drop in component orders this year.
Ever since Huawei was placed in a tight corner in 2019 by the United States of America government, things have been going awry for the company. The company has had to sell some of its assets to survive the terrible period. Its budget-friendly sub-brand Honor has also been sold, and it plans to sell its Mate and P series as brands.
The report that revealed the sad news about Huawei’s production dropping to halve in 2021 also cites sources from several companies that Huawei only plans to purchase about 70 to 80 million smartphone components this year.
Huawei has been known to ship about 189 million phones last year. Latest reports also indicate that the company may end up ordering only about 50 million smartphone components this year, after all.
Further damaging is the fact that it appears that Huawei will have no part in manufacturing 5G smartphones this year, as suppliers confirm that the company is not ordering 5G components just yet. This is understandable because the US government didn’t give the firm permission to import components for 5G devices.
There are no official statements regarding these issues from Huawei yet but there is a concrete plan by the company to divert into the agriculture business. For now, Huawei is no longer the second-biggest manufacturer of smartphones worldwide. It lost that position to Samsung, and there are indications it will slip further this year if care is not taken by the management.
It is very unlikely that the U.S government will relax sanctions on Huawei this year, and that may for Huawei out of the smartphone business in the near future.