Huawei has informed some of its suppliers that it will be delaying the production of its upcoming flagship smartphone lineup and cut down on its component orders following supply-chain disruptions due to the recent export ban from the U.S.
Apart from halting the production of some of the components required for its upcoming Mate series, the Chinese giant has also reduced orders for components required by existing devices for the foreseeable future. As per sources, the company is assessing the damage to its supply chain due to the U.S. export ban and its inability to source chips from TSMC in the future. One source has been quoted as saying "We now see the postponement of the mass production of Mate series will be for at least one to two months." Another supplier claimed that Huawei has cut down orders by 20% for the coming quarters, possibly going even lower in the fourth quarter of the year.
The cutdown in component orders could potentially lead Huawei to delay the launch of the Mate series by a month or two. The lineup has traditionally launched in the second half of the year to take on the newest iPhones from Apple.
Huawei is assessing its stock of HiSilicon chips and it is looking at other options as it tries to create a balance between demand and its limited stockpile of chips. It had already stockpiled chips in the first half of the year as it had anticipated a further lockdown from the U.S. on its supply chain. The company could be forced to source chips from Qualcomm or MediaTek, though this could lead to it redesigning some of the components inside its devices as they had been designed keeping its HiSilicon chips in mind. Qualcomm is also a U.S.-based company which could make sourcing chips from them difficult given the restrictions. This makes MediaTek, a Tawianese company, the likely candidate for supplying chips for future Huawei devices.
A Huawei executive had claimed after the U.S. export ban last month that the company's survival is at stake now.
Source: Nikkei
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