The United States is currently tightening its control measures against Huawei, and Huawei is also constantly looking for contingency measures. This morning, Ming-Chi Kuo updated his report, analyzing Huawei’s possible countermeasures and potential impacts in the face of the US ban.
According to Ming-Chi Kuo, among Huawei’s contingency measures, one of the most likely scenarios is for Huawei to sell its Honor mobile phone business.
Ming-Chi Kuo believes that Huawei’s sale of the Honor mobile phone business is a win-win situation for the Honor brand, suppliers, and China’s electronics industry. Once Honor becomes independent from Huawei, the purchase of parts by the former will not be restricted by the Huawei ban in the United States, which will also help Honor mobile phone business and suppliers to grow. Honor can maintain this brand to the greatest extent and contribute to the development of China’s electronics industry. Honor can develop high-end models after its independence.
If Honor’s mobile phone business is independent of Huawei, Xiaomi will be the most negatively affected among the existing mobile phone brands. After the Huawei ban in the United States, the market share of Oppo, Vivo, and Xiaomi is expected to increase. However, if the Honor mobile phone business can be independent of Huawei, because the ASP of Honor mobile phone is similar to Xiaomi (about US$150–220), so Xiaomi’s market share increase will most obviously be lower than market expectations.
If the Honor mobile phone business becomes independent from Huawei, and Honor can maintain Chinese users’ recognition of the Honor brand through appropriate marketing, the market share increase of Oppo and Vivo may be lower than market expectations.
Although Huawei is still under policy pressure from the United States, its mobile phone shipments in the second quarter are still impressive. It is still gaining a 20% market share, with shipments of 54.1 million units.