If you’re looking to buy a Huawei smartphone, you may want to do it soon.
Handsets from the Chinese electronics and telecom giant are expected to rise in price as the company struggles to obtain essential high-end chips due to sanctions imposed by the United States government.
A phone seller surnamed Peng said that over the past month, Huawei models with the company’s flagship Kirin chips have become more expensive, almost by the day.
“My upstream supplier can’t get enough phones from their upstream dealers, and that drives up the price,” she told Sixth Tone. Peng owns a shop in the eastern city of Fuzhou, where she sells a variety of mobile phones brands, including Huawei, as a third-party dealer.
“I’m not sure why, but I think it has something to do with the conflict with the U.S.,” Peng added. As prices have risen, Peng’s sales of Huawei phones have declined.
Since 2018, the U.S. has imposed several rounds of trade restrictions and sanctions on Huawei, which it sees as a national security threat — a label Huawei has adamantly opposed. In the latest round of sanctions, announced Aug. 17, the U.S. Department of Commerce said companies worldwide would be banned from supplying Huawei with “items produced domestically and abroad from U.S. technology and software.”
This move is essentially a death sentence for Huawei’s high-end Kirin chips, the most important component of some bestselling handsets such as the Mate 30 and P40.
During a summit in early August, Huawei executive Yu Chengdong said the company would no longer be able to produce Kirin chips after Sept. 15. “It’s a major loss for us,” he said. While the company is expecting a drop in phone production because of the restrictions, it has yet to announce a contingency plan.
As a third-party vendor, Peng can usually get ahold of phones for several hundred yuan below their listed price. When Sixth Tone spoke to her on Tuesday, however, the cheapest price she could offer for a Huawei P40 was around 4,200 yuan ($616). The model’s listed price on Huawei’s website is comparable, at 4,188 yuan.
“Since mid-August, there’s been limited supply,” a staff member at an official Huawei store in the southern megacity of Shenzhen told domestic outlet National Business Daily. The store said it currently has limited color and storage capacity options for some of its Kirin-loaded models.
When reached by phone, four major Huawei stores in Shanghai declined Sixth Tone’s interview requests, saying questions about their phone supply and inventory are “a bit sensitive” at the moment. However, some third-party dealers in Shenzhen told National Business Daily that prices for Huawei phones with Kirin chips have risen by 300 yuan on average — a trend they expect will continue.
Huawei’s headquarters in Shenzhen did not respond to Sixth Tone’s interview request by the time of publication.
Despite the relentless restrictions imposed by the U.S. government, Huawei overtook South Korean electronics giant Samsung in the second quarter this year to become the world’s top phone seller. From April to June, the Chinese company shipped over 55 million handsets worldwide, according to market research firm Canalys.
Editor: David Paulk.
(Header image: People at a Huawei store in Shanghai, May 23, 2020. People Visual)