Huawei founder vows no hit on Apple in trade war

Huawei founder Ren Zhengfei struck a defiant tone in the face of US sanctions that threaten his company’s very survival.

Huawei founder vows no hit on Apple in trade war

Huawei founder Ren Zhengfei struck a defiant tone in the face of US sanctions that threaten his company’s very survival.

In an interview with Bloomberg Television, the billionaire founder of China’s largest technology company, conceded that the Trump administration export curbs will cut into a two-year lead Huawei had painstakingly built over rivals like Ericsson and Nokia.

But the company will either ramp up its own chip supply or find alternatives to keep its edge in smartphones and 5G.

The US earlier this month blacklisted Huawei -- which it accuses of aiding Beijing in espionage -- and cut it off from the US software and components it needs to make its products.

The ban hamstrings the world’s largest provider of networking gear and No 2 smartphone seller, just as it was preparing to vault to the forefront of global technology.

It’s rocking chipmakers from America to Europe as the global supply chain comes under threat.

The ban could also disrupt the rollout of 5G wireless globally, undermining a standard that’s touted as the foundation of everything from autonomous cars to robot surgery.

Mr Ren maintained Huawei had the capability to devise its own solutions -- given time.

The CEO, however, deflected questions about how quickly Huawei can ramp up internal replacement endeavours. Failure could dent the fast-growing consumer business and even kill emergent efforts such as cloud servers.

“That depends on how fast our repairmen are able to fix the plane,” said Mr Ren.

“No matter what materials they use, be it metal, cloth or paper, the aim is to keep the plane in the sky.”

Mr Ren has gone from recluse to media maven in the span of months as he fights to save the $100bn (€89bn) company he founded.

The 74-year-old billionaire emerged from virtual seclusion after the arrest of eldest daughter and chief financial officer Meng Wanzhou as part of a broader probe of Huawei.

As Mr Ren said in January, when the world’s biggest economies battle for dominion, nothing in their way will survive.

Meng Wanzhou
Meng Wanzhou

His company is a “sesame seed” between twin great powers, he said.

“This may bring one of China’s national champions to its knees,’’ said Chris Lane, an analyst at Sanford C Bernstein.

“If China shut down all the Apple plants, the US would get very upset. This is a similar kind of move.”

Mr Ren has had much to deal with of late. His company finds itself increasingly under fire, besieged by a US effort to get key allies to ban its equipment.

Then came the blacklist. Huawei appears to have anticipated this possibility since at least the mid-2018.

Huawei is said to have stockpiled enough chips and other vital components to keep its business running at least three months.

“We have made some really good chips,” said Mr Ren, a legendary figure in his home country thanks to the way he built Huawei from scratch into a global powerhouse.

Being able to grow in the toughest battle environment, that just reflects how great we are.

President Trump said Huawei could become part of a US-Chinese trade deal, stirring speculation it was a bargaining chip in sensitive negotiations. But Mr Ren said he wasn’t a politician.

“It’s a big joke,” he scoffed. “How are we related to China-US trade?”

If President Trump calls, “I will ignore him, then to whom can he negotiate with? If he calls me, I may not answer. But he doesn’t have my number.”

In fact, Mr Ren pulled no punches in going after a man he labelled “a great president” just months prior.

“I see his tweets and think it’s laughable because they’re self-contradictory,” he quipped. “How did he become a master of the art of the deal?”

Beijing itself isn’t without options. Some speculate China might retaliate against the ban of Huawei - which may widen to include some of its most promising artificial intelligence - by in turn barring America’s largest corporations from its own markets.

Apple could relinquish nearly a third of its profit if China banned its products, Goldman Sachs analysts estimate. Mr Ren said he would object to any such move against his American rival.

“That will not happen, first of all. And second of all, if that happens, I’ll be the first to protest,” Mr Ren said in the interview.

“Apple is my teacher, it’s in the lead. As a student, why go against my teacher? Never.”

At the heart of President Trump’s campaign is suspicion that Huawei aids Beijing in espionage while spearheading China’s ambitions to become a technology superpower.

It’s been accused for years of stealing intellectual property in lawsuits filed by American companies from Cisco Systems and Motorola to T-Mobile US. Critics say such theft helped Huawei vault into the upper echelons of technology -- but Mr Ren laughed off that premise.

“I stole the American technologies from tomorrow. The US doesn’t even have those technologies,” he said.

“We are ahead of the US If we were behind, there would be no need for Trump to strenuously attack us.”

Bloomberg

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