While big orange spectre haunts certain Chinese firms, fiscal '19 treated Lenovo rather well

Despite growing political tensions engulfing some Chinese tech firms, Lenovo managed to get back in the black after peddling higher-spec PCs and cutting losses in its data centre and smartphone lines. But the tech giant has warned that things might just be set to change. The manufacturer closed off fiscal '19, ended 31 March, …

[martinusher]

Just remember that Lenovo used to be IBM

Lenovo has't turned up on the Orange Administration's radar yet but I daresay it will. Its all about technological supremacy (see Steve Bannon's remark about it being many times more important to crush Huawei than win the trade war). Unfortunately in this case we can't posture that the Chinese stole anything -- we sold them this business. Lenovo was already making IBM's laptops for them but IBM decided that this consumer business was didn't fit its corporate profile so it sold the business to the contract manufacturer. IBM ThinkPads became Lenovo ThinkPads. The fact that the Chinese ran with it and started producing increasingly good kit (the ThinkPads were a good base to work from but modern Lenovo kit is outstanding) isn't the fault of the Chinese. We just couldn't be bothered.

I suspect -- actually, I know -- the same thing happened with Huawei. We were quite happy to have them build boxes and have us sell them under our name. We just weren't interested in low margin products. They were. Unfortunately they expanded, using the low margin commodity products to gain a foothold and so opening the door for sales of higher value products. A reputation takes time to build so you have to be patient, providing good value for money and taking care of the details,. Huawei's infrastructure products in the US started like that -- they serviced the poor, sparsely populated, rural areas, the little collective telco providers that were too small for the majors to bother with. In doing so they would have made a reputation and, more critically, personal contacts between users and sales, contacts that will be maintained as user personnel moved to bigger systems to further their careers. Its all Marketing 101....

[Yet Another Anonymous coward]

Re: Just remember that Lenovo used to be IBM

Presumably when Lenovo bought the business from IBM they also bought the lobbyists.

So Lenovo are perfectly safe and patriotic to use for all you USAsians

[martinusher]

Re: Just remember that Lenovo used to be IBM

>So Lenovo are perfectly safe and patriotic to use for all you USAsians

Its indicative of our administrations 'shoot first, think about what we're aiming at later' approach that they haven't figured out just how much of the kit that they use in government (including the White House) is either made in China or has a significant number of Chinese components in it. They just don't understand global supply chains -- anything more complex than a hat with a slogan printed on it is beyond them.

Lenovo probably doesn't need lobbyists. If the supply of their computing hardware was pinched off American business would be very unhappy. Dell might find that good for business but I can't help wondering where Dell gets their sub-assemblies from (that is, just how much of a Dell computer originates from China). Its the global supply chain again....

[Anonymous Coward]

Dependant state.

What if the Chinese banned the export of electronic components in retaliation?

[Fungus Bob]

Re: Dependant state.

We would get them from Taiwan. And that would provide China with the justification to invade.

Or we wouldn't and Trump's base of supporters would have no new shiny toys and they would scream loud enough to Congress to get him impeached.

Either way, China wins...

[bombastic bob]

Re: Dependant state.

"We would get them from Taiwan"

and other places, INCLUDING MEXICO. Last I read it was becoming FAR more economical to have labor-intensive things done in Mexico rather than China, and tariffs would make this even MORE so.

And Mexico appears to respect our intellectual property. Unlike China.

"Trump's base of supporters would have no new shiny toys"

I have to wonder if the "shiny new toy" crowd consists MOSTLY of Anti-Trump'ers, just sayin'.

And those who can actually AFFORD 'shiny new toys' are probably not going to be affected much by an increase in tariffs for goods and stuff [or an outright embargo for that matter] as would those whose JOBS LITERALLY WENT TO THE FAR EAST and are NOW coming BACK!