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Huawei's attack at a drop of 40% to 60% of international smartphone shipments

Huawei's attack at a drop of 40% to 60% of international smartphone shipments

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The news of Huawei canceling the launch of a laptop and delaying its collapsible smartphone, we are now starting to see exact figures indicating how much the export ban imposed by the Trump administration may affect the activities of the Chinese company. A Bloomberg report claims to detail Huawei's internal estimates, claiming that the company expects a 40 to 60 percent drop in international smartphone shipments due to the ban on exports. Huawei generates about half of its smartphone sales internationally and, with 206 million phones sold in 2018, this would represent a loss of 40 to 60 million sales.

The Bloomberg report also talks about Huawei launching its next smartphone, the Honor 20, if sales are not up to par. The phone will be launched on June 21 in parts of Europe, but the report says "executives monitor the launch and could interrupt deliveries if it sells poorly as expected." Operators must also be taken into account in this equation, and the report says that two of the largest operators in France have already decided not to sell the device.

This morning, Huawei sent a response to the report to Ars and other outlets, stating that the launch of the Honor 20 product was still on schedule for June 21 and that the Honor 20 Pro would be available "on foreign markets ".

A drop of 40 to 60% of smartphone shipments seems almost optimistic. It is hard to imagine that an informed consumer outside China is getting a Huawei phone with so much uncertainty about the brand. Once the 90-day support window runs out, it's unclear whether customers will have access to security updates and future updates from Android or if Google Play Store and Google apps will continue to work . Huawei must especially hope that uninformed consumers will buy its smartphones, without realizing all the upheaval suffered by society.

Spare parts market prices have already increased for Huawei phones, and some rework stores are refusing to accept Huawei devices. This perceived drop in value should also affect the new prices of Huawei phones; If Huawei manages to sell some devices, the price may be significantly reduced.

Even if Huawei manages to move some units, the company is not able to buy new components from US suppliers or international suppliers using US technology. A Bloomberg report last month indicates that Huawei has constituted a "stock of components for three months" before the export ban, so that everything the company is selling now taps into this stock. Huawei's component supply will eventually dry up, and shortages will begin.

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