Oct 15, 2020 News
Huawei has been suffering in several departments, as it has had its hands tied back by the US administration - with a barrage of sanctions imposed on the Chinese manufacturer. All the limitations and bans put on Huawei has severely affected its business model, and ability to sell phones normally as it used to. For starters, the new phones do not have access to Google services, and even if Huawei is trying hard to make its own alternatives, it still will leave a lasting impact on the public mindset. Moreover, the stoppage of supply of Kirin chipsets from TSMC to Huawei has also led to the Chinese OEM to push back its release of the Huawei Mate 40 a few months.
With all these bans and sanctions in place, obviously Huawei is going to be worried about its cost to revenue ratios being disturbed and threatened - hence there have been rumours and reports saying that Huawei might be considering selling Honor - their successful sub-brand to make amends and cut back on costs for themselves. Huawei is going to try to do whatever it takes for them to be able to survive this tough time for them as a company.
The deal - if it falls through - will be valued around 3 billion US Dollars, including Honor, and its entire supply chain given to other Chinese companies - with Digital China Group and TCL being the frontrunners in the race to acquire Honor. This will not only help Huawei get rid of excessive manufacturing and operating costs - but also take off the worries off the head of Honor so it doesn’t get affected by the bans serving under Huawei.
It’s truly devastating to see such a successful and innovative phone manufacturer being held back by a country - practically fighting to keep its head afloat in the ocean of troubles that it's in. Hopefully things get better for the Chinese giant in the near future.