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Tag: Eric Xu

  • Huawei Blames US for Global Semiconductor Shortage

    Huawei Blames US for Global Semiconductor Shortage

    Huawei has laid the blame for the global semiconductor shortage squarely on the US, saying sanctions against Chinese firms have hurt the industry.

    The US has waged a long battle against Huawei and other Chinese firms, claiming they represent a threat to national security. US officials were joined by governments and intelligence agencies around the world that came to similar conclusions. Huawei, in particular, was seen as having extremely close ties to Beijing, and was believed to serve as a conduit for spying by the Chinese government.

    Huawei is hitting back, claiming the the sanctions against it and other Chinese companies are hurting the semiconductor industry, according to Nikkei.

    “Because of the U.S. sanctions against Huawei, we have seen panic stockpiling among global companies, especially the Chinese ones. In the past, companies were barely stockpiling, but now they are building up three or six months’ worth of inventory … and that has disrupted the whole system,” Rotating Chairman Eric Xu said at the company’s 18th Huawei Analyst Summit.

    “Clearly the unwarranted U.S. sanctions against Huawei and other [Chinese] companies are creating an industry-wide supply shortage, and this could even trigger a new global economic crisis,” Xu continued

    Xu said the sanctions had also hurt the trust that must exist between companies along the supply chain. This has led companies and countries to make changes, including bolstering their own semiconductor capabilities rather than rely on Chinese companies.

    In the meantime, however, the world is suffering from a massive shortage of semiconductors, impacting everything from computers to auto manufacturing.

  • Huawei Warns of Fallout If U.S. Cuts Off Chip Supplies

    Huawei Warns of Fallout If U.S. Cuts Off Chip Supplies

    Huawei is warning that Pandora’s box would be opened if the U.S. proceeds with its plans to cut the company off from its chip supplies.

    U.S. officials decided last week to move forward with alterations to the Foreign Direct Product Rule in an effort to keep Huawei from purchasing chips from companies such as Taiwanese firm TSMC. Under the rule, some foreign goods that are based, at least in part, on U.S. technology can be subjected to U.S. regulations and export rules. Officials hope to use the rule to enforce a stranglehold on Huawei.

    Huawei, however, is warning that such a move would have disastrous and far-reaching consequences. According to Bloomberg, Chairman Eric Xu told reporters:

    “If the Pandora’s box were to be opened, we’ll probably see catastrophic damage to the global supply chain — and it won’t just be one company, Huawei, destroyed. I don’t think the Chinese government will just watch and let Huawei be slaughtered on a chopping board. I believe the Chinese government will also take some countermeasures.”

    Given the number of companies that rely on China as a source of manufacturing, as well as their largest growing market, such a retaliation could have devastating consequences for many American firms.