Bloomberg: Huawei wants to circumvent US sanctions with partners

The Chinese company Huawei, burdened by US sanctions, is considering licensing its smartphone designs to cooperation partners in order to recover important parts. According to informed sources, the technology group is in talks with a part of the state-owned China Post and Telecom (PTAC), which has to buy parts that Huawei can no longer buy due to US sanctions.

The PTAC division, known as Xnova, already sells Huawei-branded Nova phones on its e-commerce platform, and through the partnership, the company will also offer its own branded devices based on Huawei designs. Chinese telecom equipment manufacturer TD Tech is also said to be selling some phones based on Huawei designs under its own brand. Negotiations over partnerships are still ongoing, according to insiders.

The United States accused Huawei of espionage, which the company categorically denied. Former US President Donald Trump blacklisted the company and banned the use of Huawei technology in communications and networking equipment. Huawei network equipment has also been removed or banned in many other countries. In the Netherlands, for example, the company no longer provides basic equipment for 5G to Dutch telecoms companies.

The company has been hit hard by US sanctions. For example, Huawei can no longer access large Taiwanese chip maker TSMC’s chips, Google’s Android apps and Qualcomm 5G wireless modems. Huawei saw its revenue decline for the fourth consecutive quarter in the last quarter.

Huawei sold its sub-brand Honor a year ago to a consortium led by a Chinese state-owned company in Shenzhen, freeing the company from US sanctions. Honor can now purchase components from suppliers, including Qualcomm. The success of this sale encouraged Huawei to seek new partnerships to maintain its consumer business.