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Huawei Blames US for Global Chip Supply Crunch (nikkei.com) 55

Posted by msmash from the how-about-that dept.
Huawei has blamed the U.S. for the chip crunch rocking the global tech industry, saying Washington's sanctions against Chinese companies have spurred panic buying of semiconductors and other supplies. From a report: "Because of the U.S. sanctions against Huawei, we have seen panic stockpiling among global companies, especially the Chinese ones. In the past, companies were barely stockpiling, but now they are building up three or six months' worth of inventory ... and that has disrupted the whole system," Rotating Chairman Eric Xu said at the company's 18th Huawei Analyst Summit. The U.S. has placed Huawei and other Chinese tech companies on trade blacklists that restrict their access to American technology, citing national security risks. "Clearly the unwarranted U.S. sanctions against Huawei and other [Chinese] companies are creating an industry-wide supply shortage, and this could even trigger a new global economic crisis," Xu added. Xu's remarks come hours before the White House plans to host a summit aimed at addressing the chip shortage, with an emphasis on its impact on the automotive industry. Dozens of executives from U.S., Asian and European tech companies and automakers -- including General Motors, Ford, Google, Intel, Taiwan Semiconductor Manufacturing Co., Samsung Electronics, and NXP -- are slated to attend the event. White House officials have already acknowledged that the chip shortage may be difficult to solve in the short term.
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Huawei Blames US for Global Chip Supply Crunch More

Huawei Blames US for Global Chip Supply Crunch

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  • Huawei got what all of China deserves (Score:2, Insightful)

    by Anonymous Coward

    The Chinese Communist Party is the second worst actor on the international scene right now.

    Look at how Hong Kong immediately turned into a repressive hellscape immediately after China took control. What a tragic end to what had once been one of the true wonders of the modern world.

    And chock one more victory up to ultra-sleazy Chinese officials.

    It's time to teach China a very strong lesson. Not with incompetence and racism, but with strong diplomacy backed by our military strength.

    If China thinks it can stea

      • Easy to cherry pick blame. How about the Wuhan authorities for trying to cover up a pandemic. One of thousands or millions of potential scapegoats. Huawei should stay out of CCP propaganda it is to obvious. Though it is prevalent elsewhere in non authoritarian states too. Basic Nationalism.

    • Re:Huawei got what all of China deserves (Score:5, Interesting)

      by jellomizer ( 103300 ) on Wednesday April 14, 2021 @09:50AM (#61272100)

      I would say China is one of the United States biggest threat against our interests. But they are some really bad actors on the international scene that would make China look like a warm and friendly government.

      I am not saying China doesn't have a lot of Human Right Problems, and they are the good guys. But the United State Too has its own problems that can be pointed to right back to us. But still they are other countries, who level of human rights is just horrendous.

      The sad truth is Human Rights isn't big on the schedule of international politics, it is only brought up as a way to help with the local propaganda to have backing towards aggressive international policy.

      China is a big trading partner and competitor where a lot of its actions are against American and Western Self Interests, so Western Countries need to be tough on them, but they just use what China has for Human Right Violations as just Political tools for the general public to make sure we feel justified being so tough on the nation.

      They are countries that we don't trade much with, and we more or less will just sit back and let everyone kill each other off, because they have little to offer to US, and don't pose any real threat. If we really cared about human rights we would be very involved with a lot of countries.

      Now the United States has its problems too. Which countries like China and Russia will point at us and ignore their issues to show their general public how bad we really are.

      • Re:Huawei got what all of China deserves (Score:4, Insightful)

        by AmiMoJo ( 196126 ) on Wednesday April 14, 2021 @09:59AM (#61272152) Homepage Journal

        The question is what are you going to do about it.

        You could try a trade war, but we have seen how that doesn't work and hurts you as more than them. You could try an actual war, but nobody wants that.

        Cut them off? Then we have no influence, and it hurts us a lot.

        So what's left? Try to bring them on-side with the possibility of trade, with the requirement to meet certain standards like no forced labour and generally high standards for employees. That does work. It takes a long time but look at manufacturing in China now; factory jobs are sought-after and conditions have improved a lot. Having a nice clean factory with well looked after employees has become a selling point.

        We can also compete, e.g. I think it's a good idea to set up fabs in the EU and US. As well as redundancy and security it also means that there is competition on things like human rights.

        It sucks that we can't just fix it, but we can't.

        • Me, personally the best I can do, is vote for officials that have some experience with international diplomacy.

          However what we as a country can do probably isn't the quick fix, but really a slow process of diversifying our supply chains, investing into local manufacturing, as well manufacturing in countries that are reliable. So if Chips can be Made in the United States, Canada, UK, France Germany, Japan, South Korea, as well as China and India. As well see if some African Countries may want to be investe

        • "So what's left? Try to bring them on-side with the possibility of trade, with the requirement to meet certain standards like no forced labour and generally high standards for employees. That does work. It takes a long time ..."

          How much does that kind of thing work. Are other factors behind the change. Would you think other countries can change the 'US industrial prison complex', "bring them on-side with the possibility of trade, with the requirement to meet certain standards ...".

          "but look at manufacturing

  • flashbacks to the Arab Oil Embargo of the early 70's.

    • I dont mean to imply its deliberate I COULD be, but an article yesterday showed PC sales way up, so demand IS higher. Im awaiting GM to announce their new truck that now has a "non electronic, much simpler engine management system" and they bring back the carb!

    • The OPEC embargo set the US on the path to renewable energy so that in the long run OPEC loses its power. Now US has done the same with Chips. In the short term Chip consumers like China have to pay exorbitant prices to get supply but in the long term they are on the path to developing their own chips. 10-15 years from now we may see a negative CPU price like we saw negative oil last year.

    • We want cheap vs robust.

      It is a tough sell to promote paying more money for a more robust system. Why pay $1,750 for a laptop that has Chips from manufacturers that are spread across the world, where you can pay $1,250 for a laptop of the same speed and performance, with chips from one country that we have a shaky relationship with.

      For the consumer, they are just going to get the lower price product. The company wants to target the customer. So this process drops robustness in supply chain towards being

  • Slight problem with that theory. (Score:3)

    by Gravis Zero ( 934156 ) on Wednesday April 14, 2021 @09:34AM (#61272036)

    "Clearly the unwarranted U.S. sanctions against Huawei and other [Chinese] companies are creating an industry-wide supply shortage

    The sanctions only apply to U.S. companies selling to China. Most ICs are not produced by U.S. companies. The big ones are TI, Microchip, Qualcomm, Intel, and AMD. Meanwhile, there are plenty of non-U.S. companies like NXP, STM, Samsung, Sony, and others that still deal with China.

    Huawei is just upset that it cannot get a supply of Qualcomm chips to put in their smartphones.

    • Re:Slight problem with that theory. (Score:4, Informative)

      by ghoul ( 157158 ) on Wednesday April 14, 2021 @09:45AM (#61272076)
      US sanctions are what we call "dog in the manger" sanctions. Not only are US companies not allowed to do business with China, non US companies are also not allowed else they will be prevented from doing business with US. If they set up 2 different companies , one to do business with China and one to do business with US they will be charged with fraud and extradited. The Huawei CFO case was that Huawei setup a separate company to do business with Iran. (Which was totally legal under Chinese law as their are no UN sanctions on Iran)

    • ...or their self-driving cars.

    • Not entirely. The sanctions also apply to non US companies dealing with Huawei if it contains US technology unless these companies apply for an exemption. For example, NEC (Japan) cannot sell PCs to Huawei that have Intel or AMD CPUs if NEC wants to do business with the US again.

      • Re:Slight problem with that theory. (Score:4, Informative)

        by Hmmmmmm ( 6216892 ) on Wednesday April 14, 2021 @11:11AM (#61272592)

        The reason why many foreign companies/countries were getting pissed off at the US, was because US companies were getting exemptions but foreign companies weren't getting exemptions or deliberations regarding the exemptions were being delayed. Therefore US companies were making money selling to China, while foreign companies were potentially getting sanctioned if they proceeded with sales.

    • Re:Slight problem with that theory. (Score:4, Interesting)

      by Mr. Barky ( 152560 ) on Wednesday April 14, 2021 @10:18AM (#61272266)

      It doesn't matter that the ICs aren't produced by US companies.

      The problem is that the US reach in the financial system is quite broad and deep. As an example, the US has shown it is willing and able to prevent Europe (an economy of roughly the same size as the US) from doing any trading of significance with Iran despite their stated desire to do so. How? It places sanctions on any entity trading in US dollars to Iran. This is basically, well, every major entity in the world. So companies cannot at the same time trade on the world markets (which are basically all denominated in dollars) and do trading against the US's current trade policy. This applies to trade with China as well - including things like trading patent rights (in the high-tech world this is quite important).

      For now, it is with just a few targeted Chinese companies. Companies can of course make a choice to follow US sanctions or trade solely with China. Any company that doesn't do the majority of their business in China (or are on the sanctions list themselves) will likely choose to obey the US sanctions (with some cheating at the margins...). China is a lot bigger than Iran, so if the trade disputes expand, you might see more and more companies forced to choose one side or another (and more would choose China than chose Iran).

    • Re: (Score:2)

      by fermion ( 181285 )
      There are many factors, and just blaming US embargo is simplistic. For instance, the Texas freeze caused massive supply chain problems for chemicals that impacted chips and other material. Some chip fabs in Texas were closed.
  • Agents of a hostile foreign power say that 'US Bad' huh? That's really surprising.

  • If their projected sales plummet, all that inventory with high market prices will end up on the market.

    • Which countries will join those sanctions? Do you think you can convince them? Second, increased global isolation will eventually lead to World War III which would not turn out as great for everyone like WWI and WWII. We are far better off using more subtle tactics. Also, why are we ignoring China as a market? Germany has trade parity and sometimes surplus with China in spite of having free trade with them. In fact, the average German buys MORE from China than the average American, yet Germany has trade par

  • Pot calling kettle black... (Score:1, Insightful)

    by Anonymous Coward

    All Chinese countries have to have members of the government/CCP as part of the board. It would be like the US having CIA, DHS, NSA, or FBI members as directors who can override all decisions in any company on US soil.

    Hint: China makes all those chips. A shortage for stuff made on their soil is not the US's problem, it is China's propaganda.

    What really needs to happen is that chipmaking plants need to be created in the West. Doesn't have to be the US, but can be Europe, Canada, or locations where compan

    • Re:Pot calling kettle black... (Score:5, Interesting)

      by ghoul ( 157158 ) on Wednesday April 14, 2021 @11:49AM (#61272808)
      Most of the chips in shortage are made in Taiwan, USA or Korea. When Covid happened American car companies threw their vendors under the bus and used Force Majeure to cancel orders. Chinese bought up the supply because they had their own fears about the chip supply being cut off. When Covid turned out to be not as bad as feared for the economy the car companies went back to their vendors and said they want to buy again. I a sure the vendors enjoyed the Schadenfreude as they told them to go pound earth as the next 2 years of production are already sold.
    • Downstream components may come from China, and final assembly of certain components may happen in China - but actual fab happens in Taiwan, Korea, Singapore, Japan, US etc. China has struggled for several decades to break into the semiconductor industry and has failed to do so - it's not exactly something that can be copied and fabricated, while simultaneously having the ability to design and fab the next generation. China will catch up, but it won't be anytime soon.

  • That's what you get. Globalization is great, the outsourcing aspect of labor I'm sure is great and cheap for many companies, until national interests take precedence (nefarious or not). And what's the contingency plan in these cases? Ah yeah, there isn't one.

    • I guess executives need to start moving to China.

      • One would hope... But I think the roles are already filled, as Chinese possibly already have their fair share of inept leeches with see people are replaceable resources instead of human beings

    • The chips are in many baskets. Just not "our" basket ("our" can be pretty much any group you wish to define).

      • It's interesting to see the lists here: https://en.wikipedia.org/wiki/... [wikipedia.org]

        USA dominates the companies list, whereas Asia completely dominates the production/exports. Who has exactly the upper hand here? If the architects and the builders (with blueprints) have an argument, who's going to be homeless if things go south?

    • The chips aren't in one basket. Most chips are fabricated in either the US or Taiwan, neither of which is China. Korea (the southern one) also has a growing industry as well. The company that builds most of the machines to enable all of this is in Europe.

      China just assembles most of it into an end consumer product because they have cheap labor and the investment into the infrastructure to enable that production was done years or even decades ago.

      The issue is that the pandemic created a spike in demand

      • I didn't know that US does much fabrication. That's something. In the pandemic though, with a demand spike, who suffers the greatest effect of shortages you think? Certainly not the ones who assemble the parts. If somebody is going to have access to the finished product first, it's going to be the ones at the end of the supply chain, just before transport/consumers

  • Huawei angry about Huawei caught installing spying methods and backdoors in their devices in the past, causing US sanctions, causing panic buying.

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