Huawei’s status as the world’s largest smartphone maker might get challenged soon, as the company scrambles to get key parts for its phones.
It all started with the U.S. trade ban, which meant Huawei could not get access to Google services or do business with U.S. companies, including chipmakers Qualcomm and Broadcom.
Now, according to a report by South Korean outlet Chosun Biz (via Android Authority), Korea’s LG and Samsung will stop supplying premium smartphone displays to Huawei, starting Sept. 15. It’s unclear what “premium” means in this context; the report probably refers to OLED displays, which are used on Huawei’s flagships. For example, Huawei’s P40 Pro uses a Samsung-made OLED display.
This is a big deal, as LG and Samsung are among the world’s largest supplier of displays, and an important part of Huawei’s supply chain. Now, Huawei will have to order displays from China’s BOE, as well as other local companies such as Visionox, Tianma and CSOT, but it’s uncertain whether those suppliers will be able to produce enough to satisfy Huawei’s needs.
Chosun Biz also says Huawei might have trouble getting display, power management and touch controller chips, and a recent report said Samsung and Hynix will also stop supplying memory chips to Huawei.
Put all of that together, and it’s clear that Huawei will have major issues in putting together smartphones at its desired volumes. It’s no wonder that the company reportedly plans to produce just 50 million smartphones in 2021, a 74% year-over-year decline from expected 2020 shipments.