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Does Huawei Rely Heavily on U.S. Technology?
COVID-19 and China
NYC. Image Credit: Jonathan riley/Unsplash

A recent dissect of Huawei’s flagship phone shows that 1% of the products used to make the chip come from the U.S. which adds up to 16% of the total cost. In terms of the cost, 62% of components are made outside of China.

The U.S. parts include communication semiconductors from Qorvo, the North Carolina based chip maker and cover glass from a New York-based technology materials group Corning

Hence we can say that most of the parts found on the motherboard of Huawei’s Mate X 20 5G are made by the company’s in-house chipmaker HiSilicon and other Asian manufacturers. There are, however, a few key components that enable the phone’s 5G connectivity are made by US companies, according to iFixit, a computer repair company based in the US.

According to Southwest Securtities, it will be hard for Huawei to replace the two companies since the RF front end chip-making market share is hugely dominated by U.S. companies. 

Will Wong an analyst at IDC said: “American suppliers usually have more advantages in some key components for 5G phones, such as RF front-end chips.” He further added, “I believe Huawei can find alternatives to these RF front-end chips, but it will take time for it to find sources that can compare favorably with American supplies in terms of stock and quality.”

Just about a few months ago Huawei took over Apple as the biggest smartphone member and was aiming to take on Samsung. However due to the situation created by the trade war the firm had to give up the ambition. 

Huawei isn’t the only company suffering from the trade war. U.S’s very own Apple assembles the vast majority of its phones in China, Washington's threat to impose additional tariffs of up to 25% could lead to significantly higher prices.

Morgan Stanley reports that consumers could have to pay around USD 1,160 for the least expensive XS against USD 999 currently. 

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