Huawei: China should not punish Apple

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Asked by Bloomberg about boycott calls in China Apple (AAPL)Ren said he would oppose any retaliatory action by Beijing, even as tensions with the United States intensify.

"It will not happen first, and then if it happens, I'll be the first to protest," Ren told Bloomberg.

"Apple is the first global company, without Apple, there would be no mobile internet," said Ren. "Apple is my teacher, he is advancing in front of us, as a student, why should I oppose my teacher?" he added.

The comments arrive while Ren's company is in crisis mode.

The US Department of Commerce has placed Huawei on a blacklist of trade earlier this month, effectively preventing it from dealing with US companies.
The ban forced suppliers like Google (GOOGL) and ARM Holdings to break ties with Chinese society. Major British and Japanese operators are also delaying the launch of Huawei smartphones.

US restrictions threaten Huawei's position as the world's largest manufacturer of telecommunications equipment and the second-largest smartphone brand.

The ban on Chinese society by Washington "could wake up the smartphone industry by pausing Huawei's positive momentum," wrote Fitch Ratings analysts in a note on Sunday. The ban could also benefit the industry leader, Samsung, as consumers around the world look for alternatives to Huawei smartphones, they added.

What did Huawei do to land in such hot water with the United States?

Huawei and Apple had very different fortunes in Huawei's Chinese domestic market.

Huawei delivered nearly 30 million phones in China during the quarter ended March, up 41 percent from the same period last year, according to research firm Canalys.

Meanwhile, Apple saw its iPhone sales fall by 30% over the same period. The country remains a key market for Apple. Wider China, which includes Taiwan and Hong Kong, accounted for nearly 18% of net sales for the quarter ended March.

At a call for results last month, Apple CEO Tim Cook said that iPhone sales in China should be boosted by "improved business dialogue" between Beijing and Washington and by "a very positive response from our customers to the price measures we have taken in this market".

Huawei could be the first big victim of China's clash with the United States
But since then, trade talks between Washington and Beijing have broken down and both sides have tightened tensions by applying more penalties to billions of dollars worth of US and Chinese products.

The resumption of trade conflict could hurt Apple, according to analysts Fitch Ratings.

"Apple could be another victim of the US-China trade war and its loss of market share could accelerate in the Chinese market," they said.

US President Donald Trump last week described Huawei as "very dangerous," but then said he could see the company included in a broader trade deal with China.

Ren told Bloomberg that using his business as a currency was "a big joke".

"How are we related to Sino-US trade?" he said.

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