Several South Korean suppliers to Chinese tech giant Huawei allegedly will stop shipping their products to the Chinese company next week in response to U.S. sanctions.
According to one of the unnamed sources, it was possible that Samsung Electronics would sell its products to Huawei again after applying for U.S. government approval.
Separately, a total of 152 Huawei and its affiliates are now on the U.S. trade blacklist, meaning that U.S. companies need to obtain special licenses in order to do business with them. Huawei and 68 of its affiliates were first added to the blacklist in May last year on national security grounds.
SK Hynix declined to comment in an email response to The Epoch Times. Samsung and LG did not respond by press time.
Taiwan-based TSMC, the world’s largest contract chipmaker, also said that it will not ship chips to Huawei after Sept. 14.
According to a report by Seoul-based brokerage Eugene Investment and Securities, in 2019, Samsung earned 7.37 trillion won (about $6.2 billion) from selling chips to Huawei, which made up about 2.3 percent of the company’s total sales. Meanwhile, SK Hynix earned about 3 trillion won (about $2.5 billion) from its chip sales to Huawei last year.
Kuo Ming-chi, an analyst in the smartphone sector, told The Korea Times that Huawei could quit the smartphone business if the U.S. sanctions turned out to have a severe impact on its business operations.
A less severe impact could see Huawei lose its smartphone market share, Kuo added.
Park Hyung-woo, an analyst at Seoul-based Shinhan Financial, estimated that Huawei’s sales of smartphone units would drop to about 190 million this year from 240 million in 2019, according to The Korea Times. Next year, the number could dip below 100 million units.