The Biden administration is going forward with the policies enacted by the previous administration, as it tightens its reins around Huawei. It has imposed stricter conditions on certain companies that have previously acquired export licenses for dealing with the telecom equipment maker.

According to a Bloomberg report, the US government has placed new restrictions regarding items that are used in or with 5G products. The new 5G ban is effective as of this week, as per people close to the matter. With the new rule, the Biden administration has created a new restriction on the export of components like semiconductors, antennas, and batteries for Huawei 5G devices. In other words, creating a more uniform ban among the licensees.

For those unaware, a few American firms had previously received licenses that allowed them to continue shipping components to the Chinese tech giant that might even be used in building their 5G equipment. Previously, the Trump administration had placed Huawei along with other Chinese companies under the trade blacklist, ‘Entity List,’ which basically required US based firms to acquire a license to trade with the brand.

And now, it seems like the recent move from the Biden administration pushes forward the restrictions that were placed on the company by Trump. Furthermore, this also signifies the stance the new administration is planning to take against China and Chinese companies. As per William Reinsch, senior adviser at the Centre for Strategic and International Studies, “From one perspective, it’s clean-up and correcting mistakes from the previous administration.”

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Honor has apparently signed partnership deals with key chip suppliers after its separation from its former parent company, Huawei. The brand has now partnered with Intel and Qualcomm.

According to a Reuters report, the Chinese budget smartphone maker is only able to partner with these major chip suppliers due to its separation from Huawei. The latter is suffering from the impacts of US sanctions, which have crippled its smartphone business and also disrupted its supply chain. For those unaware, Huawei sold off Honor last year, to a consortium of 30 of its subsidiary’s agents and dealers in an effort to save its budget smartphone sub brand.

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Earlier today (22nd January 2021), the company launched the Honor V40, which was sold out in just over 3 minutes. This marks the first device that the brand has launched after the split, and it seems like the company is off to a positive start. Now, it is even partnering with key suppliers from across the globe, including AMD, MediaTek, Micron Technology, Microsoft, Samsung, SK Hynix, and Sony.

According to George Zhao, “the last five months have been an extremely difficult but meaningful time for Honor. We feel the weight of expectation from industry partners and consumers.” After its independence from Huawei, Honor is expected to also launch mid to high end smartphones in the near future while also focusing on expanding its presence in the overseas market. It would also make efforts in launching IoT (internet of things) products and other smart connected products as well.

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Major smartphone brands have a list suppliers that enables them to procure the components required to build their products for the market. However, in recent times the increased competition in these supply chains might be driving them out. Now, a couple of Samsung suppliers are also looking to branch out to other ventures to reduce their reliance on smartphones.

As the smartphone market matures, the competition between the suppliers is increasing. This makes profitability difficult as well, and force these firms to also look for a new source of revenue, as per TheElec report. An example of this is Mcnex, which is looking to supply automobiles with camera modules. At the moment, it supplies cameras to Hyundai Motor Group. The company is currently reliant on smartphones that account for 90 percent of its sales, but is expecting an increase in demand from automobiles in the near future.

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Back in 2018, these automotive camera modules accounted for 15.1 percent of its sales. This dropped to 9.2 percent in 2019, but has since gone up to 10.6 percent in the third quarter of 2020. Similarly, Powerlogics, which is another camera module supplier, is also working with Hyundai to recycle batteries. Its reliance on smartphones is also 82.9 percent as of last year. Although, it is looking to increase its shipments of protective circuit for batteries.

Other Samsung suppliers include DAP and Korea Cicuits, both of which supplied on motherboards for smartphones, that are now shifting towards the automobile industry as well. The former is supplying boards to Hyundai Mobis, which are then made for radar for Hyundai Motor Group. The list of suppliers looking to diversify away from smartphones continues and may soon have other notable suppliers make the shift as well.

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Earlier today (9th November 2020), Apple announced that it has put its Taiwanese supplier, Pegatron, on probation after the company was found violating its supplier code for employing student workers and asking them to work overtime and on night shifts.

According to a Reuters report, Pegatron had wrongly classified its student workers and even provided false paperwork to disguise its violations. This led to a breach in contract on multiple counts as well, as students were even working on cases that were not related to majors. For those unaware, the supplier is one of the handful of firms that the Cupertino based giant employs from Taiwan, which also dominates its supply chain.

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An Apple spokesperson stated in a conference that “Several weeks ago, we discovered Pegatron – one of Apple’s suppliers in China – violated Apple’s Supplier Code of Conduct in its administration of a student work study programme.” It was further added that “Apple has placed Pegatron on probation and Pegatron will not receive any new business from Apple until they complete all of the corrective actions required.”

At the moment, the terms of the probation are unknown. Furthermore, an investigation from Apple has not found any evidence of forced or contracted labor of underaged individuals. Pegatron has since fired its executives that were directly involved with the oversight of the program and the minors have also been taken off production lines, and have also received “proper compensation.”

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As global telecom equipment makers like Ericsson and Nokia shift downscale their production in China, their South Korean suppliers are also following suit. Ace Technologies and KMW, the suppliers of the two telecom equipment giants are shifting their production to Vietnam.

According to TheElec report, the move from Ericsson and Nokia has become an opportunity for its South Korean components and materials providers that have facilities in Vietnam, as per a source close to the matter. KMW and Ace Technologies supply their goods to Nokia and Ericsson respectively and are downsizing their productions in China, and now focusing more on Vietnam.

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Similarly, Samsung has also moved its Networking division from Gumi to Suwon back in 2019, and had begun mass production in the country within the same year. Notably, Many South Korean suppliers have already built a good foundation in Vietnam, as they followed the tech giant, Samsung, who had been investing heavily in the Southeast Asian country.

At the moment, Vietnam is offering cheaper labor costs in comparison to China and is more suitable for mid sized supplier firms. Ace Technologies had completed its new factory in the region back in March, which has tripled its production capacity of radio systems and antenna filter units. It is now also planning on producing over 100,000 units of 4G and 5G remote radio heads as well.

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