Could Huawei sell its Honor division? In any case, this is what the famous analyst Ming-Chi Kuo thinks, who very often hits the mark. He sees here a way for Huawei to save its brand but also to make money very quickly. However, the Chinese brand seems to deny these speculations.
Huawei could sell its Honor brand. This is what analyst Ming-Chi Kuo says, known for his predictions which are very often right. For him, this is a solution that would benefit both Honor and his parent company.
Indeed, Huawei has been under an American embargo since 2019 imposed by the Trump administration. He cannot use components and software from Uncle Sam’s country, or from companies related to the United States. A handicapping situation for the manufacturer who sees himself in the obligation to make 100% made in China and which weighs heavily on his finances. Because the goal of the White House here is to suffocate the brand, accused of espionage on behalf of Beijing.
A sale that would benefit both brands
By reselling Honor, Huawei could therefore rake in a large sum of money, especially since, according to the analyst, its brand would be of interest to many investors. Such an operation would also be beneficial for Honor. The Huawei branch is in fact flying on its own today and is no longer a simple “sub-brand” offering smartphones at discounted prices featuring Huawei technologies. Honor is a brand that matters and could build on a strong community to continue on its own in a very competitive market.
Such a resale should also allow him not to be subject to the same restrictions of the parent company and use whatever components she wants in her smartphones. Because just like Huawei, Honor is in difficulty on this point, logically suffering the American embargo. An operation that would make sense, according to Ming-Chi Kuo, but which is probably not on the agenda.
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As GSM Arena notes, company employees have spoken to Weibo, China’s most popular social network, to refute Ming-Chi Kuo’s claims. If no official response has been given, however, it still smacks of a failed prediction for the analyst, which is rather rare, it should be pointed out. However, the idea is far from absurd when we look at the situation of the Chinese giant.
Huawei in trouble
The emergence of 5G and compatible smartphones will give a welcome boost to the smartphone market which has been in recession for two years now. It is estimated that more than 1.5 billion 5G smartphones will be sold in 2023, and 1.7 million in 2025. A boost which Huawei will not be able to enjoy outside its borders.
Digitimes believes that Huawei to see sales plummet to other Chinese brands with long teeth, like Oppo, Vivo or Xiaomi, with very aggressive marketing in recent years. With such a situation and such competitors, Huawei could thus fall to seventh place among the best sellers of smartphones in 2021. A blow for a company which squatted the podium.
But as the site notes, all is not lost, however. Japanese companies, such as Sony or Kioxia, have requested a waiver from the United States to continue working with Huawei. It’s not just about helping a struggling brand, as Huawei is a big partner for Sony when it comes to photography. The embargo therefore indirectly puts its business in difficulty, and it is far from the only company in this case.
A glimmer of hope for Huawei which in all likelihood does not seem not be willing to sell Honor anytime soon. The situation remains very tense for the manufacturer and things are changing very quickly. If Honor isn’t for sale today, there is nothing to say it couldn’t be for sale tomorrow.