Huawei Chip Ban Will Cost Jobs, Company Will Leave The US Forever

Advertisement
Advertisement

Huawei says that the new chip ban in the US will cost America jobs, as the company will leave the US forever. These are the words of Huawei USA Chief Security Officer Andy Purdy in a recent Bloomberg interview.

Huawei chip ban will cost jobs, company will leave US forever

Purdy points to Huawei's $12 billion investment in the US economy. As a result, "blocking us will hurt the American semiconductor industry and hurt them permanently." Without Huawei's $12 billion investments annually, Purdy is saying, the US will feel the financial pinch of the Huawei ban.

Purdy also responds to questions about the financial loss the company incurred last year. Huawei lost $12 billion in revenue in 2019. Huawei is struggling to win contracts as a result of American bans.

Advertisement

He responds by saying that Huawei will come out of this "on the other side" but "if we're not forced to not buy from American companies this non-sensitive technology, we'll go elsewhere and we won't come back."

Purdy says that with Huawei out of the US, America will lose jobs. Should Huawei pull out, Huawei USA personnel will either lose their jobs or move to other Huawei locations.

US Entity List

Huawei has been on the US Entity List since last May, when President Donald Trump issued the Executive Order. Since then, Huawei has seen its Android license revoked by Google. The Chinese OEM can only do business with American companies that receive licenses from the Federal Government.

Advertisement

As for its Android ambition, Huawei is still not allowed to use Android for its latest smartphones. It has been granted a few license extensions to continue updating existing Android smartphones, however. The $12 billion lost in 2019 is due to the first US ban. This second US ban has the potential to further hurt Huawei financially.

Huawei has had to turn away from its Android ambitions in order to stay afloat in the mobile sector. The company has created its own HongMeng OS (officially revealed as "HarmonyOS") that is open-sourced.

The company is pouring at least $1.5 billion into developing its operating system. Additionally, the company is creating its own app store (AppGallery) and employing an app search engine (called "AppSuche" in German) to help users find third-party apps they cannot find in AppGallery.

Advertisement

Additionally, Huawei just launched the P30 Pro New Edition, a re-released phone that contains Google apps and Google Play Services earlier this month.

Huawei Chip Ban might create opportunities for other companies

More recently, Huawei has now been blocked from buying manufacturing chips that include US technology. The new rule requires sellers to secure a US license before selling to Huawei first if their chips rely on US technology.

This isn't just for chipmakers in the US, but global chipmakers whose product includes American tech. What this means is that Huawei can no longer buy chips from companies like TSMC (which makes Huawei's HiSilicon chipsets) without TSMC securing a US license first.

Advertisement