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Huawei phone prices rise in China for fear of tip shortage

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Chinese consumers are rushing to buy smartphones from Huawei with high-end Kirin chips, fearing that curbing the company’s access to U.S. technology will soon stop producing premium handsets. I will.

Huawei’s phone vendor, Huaqiangbei’s phone vendor, the world’s largest electronics market in the southern city of Shenzhen, said Huawei’s new and used phone prices ranged from RMB 400 to RMB 500 (almost Rs) in the past month. ). 5,400) Average. According to one vendor, Huawei’s flagship Mate 30 Porsche Design model was priced from RMB 10,000 to Rs 14,000 in January (about Rs 1,52,200). The phone was available at a similar price on the online market Taobao.

According to one vendor, consumers are increasingly worried about the supply of components for new mobile phones.

“Huawei phones are getting expensive, but it’s supply and demand,” said the vendor who named her as Xiao. “People who like this brand will pay more, and who knows how good the chips they have in the future?”

The U.S. government said last year that it worked to prevent most U.S. companies from doing business with Huawei, and that the world’s largest manufacturer of mobile communications equipment and smartphones would ultimately be liable to the Chinese government. Huawei has repeatedly denied that it is a national security risk.

Last month, the United States further tightened regulations restricting access to commercial chips, urging Taiwan Semiconductor Manufacturing (TSMC) to stop shipping wafers to Huawei.

Richard You, Huawei’s Chief Consumer Business, announced that it will stop manufacturing Kirin chips on September 15 due to US measures to separate the chip manufacturing unit HiSilicon from key technology.

HiSilicon uses software from US companies such as Cadence and Synopsys to design chips and outsources production to TSMC, which uses US-made equipment.

Market wholesalers said last month that they were busy meeting the additional demand for online sales, with high-end phone prices rising every few hours. They were uncertain how much supply remained for the distributors.

Huawei does not disclose inventory information. A spokesman told Reuters that the company continues to operate on demand.

Will Wong, an analyst at consultant IDC, said chip inventories are likely to continue until the first half of next year.

“One option for them to make their giraffe chips last longer is to ship less during the rest of the year,” Wong said.

Huawei said last week that it plans to introduce the Harmony operating system on smartphones next year to overcome some of Alphabet’s restrictions on Android access in the United States.

Still, Canalys analyst Mo Jia said the launch of Harmony would be a “symbolic innovation” only if Huawei no longer had the chip supply to make high-end phones.

Thomson Reuters 2020

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