Huawei's supply chain squeeze tightens, as SK Hynix and Samsung set to stop selling chips to the Chinese bogeyman as of next week

Huawei’s rotten year looks to be getting worse amid reports in South Korean paper Chosun Ibo that Samsung and SK Hynix will turn off the component tap to the firm from next week, due to pressure from the US government. The two South Korean businesses - along with many others - will reportedly cease selling certain parts to …

[Chris G]

To paraphrase Henry II; Who will rid us of this meddling pest?

This idiot in his alleged pursuit of MAGA is damaging jobs and businesses all over the place due to fallout from his targetting China, Chinese businesses and many others all over the planet.

[Mark Exclamation]

Sorry, China needs to be targeted until they become a trusted country with which to do business. I have no beef with Huawei, but if they have to suffer in order to bring the Chinese government to its senses, then I support these measures. The world needs to do more.

[Anonymous Coward]

Personally I think we all should just go to war and be done with it. Have another good old-fashioned Allies vs Axis.

This psuedo Cold War bullshit is no different than whiners kicking around in the sandbox because they can't get their way, rather than attack China directly for their copious and continual human rights violations, the administration's massive profit from other countries' free markets while fostering incredibly garbage wages across the board and fixing its own market, poor treatment and essentially cultural brainwashing of ethnic minorities, and so on.

AC for likely unpopular opinion.

[Flywheel]

Uh oh ...

I really hope this doesn't result in Taiwan being "liberated" by China and therefore becoming part of China's domesticity!

[alain williams]

Re: Uh oh ...

The real question is: If China does invade Taiwan what will anybody do about it ?

[Mark Exclamation]

Re: Uh oh ...

Nope, the real question is: when China does invade Taiwan what will anybody do about it ?

And the answer is "nothing".

[CrackedNoggin]

Re: Uh oh ...

That's a completely unrealistic prediction. For one thing, the PLA would need to start by neutralizing counterattack with preemptive strikes before sending several hundred thousand soldiers across the straits. Most of that would be accomplished with China-land based cruise missiles of which there are probably tens of thousands.

Whether or not the US would counter attack those land based missiles launch sites (many of which may be mobile), the US would certainly attack any troop transports heading to Taiwan. Which puts the PLA in a position of needing the neutralize any nearby US Navy and US Air Force First, or at least destroying them should they appear to be taking any action, which they would.

It's 160 km across the Taiwan Straits that 3-4 hours for a troop transport. 1-1.5 flight time from Okinawa to Taiwan straits. The PLA would still need to maintain supply across the straights after the invasion.

While it is conceivable that China could achieve invasion and declare "victory" in Taipei at least, that would involve de facto war with the US, after which it would not be business as usual. In fact it could be anything from a new dark ages to WWIII and an x100 downsize in human population.

[CrackedNoggin]

Re: Uh oh ...

The real answer is that the PLA is edging out the business class for control of the CCP. The most blatant display of that is the surprise attack by the PLA on the Indian army in Himalayas using spiked clubs to kill 20 Indian soldiers. Pure belligerent posturing with no practical use whatsoever, resulting in a huge loss in trust of Chinese businesses making profits in India. The PLA is edging to do something in Taiwan - and when they do that will certainly cause a huge decrease in trust of doing business with China. An invasion of Taiwan would certainly result in western countries sourcing everything from nuts and bolts on up to electrical components from geographically safe areas away from China - and probably would result in active war with the US, if not WWIII.

[iron]

I'd be interested to hear how many UK jobs have been lost because Boris cowtowed to Donnie and his orange crusade against Huawei.

[Anonymous Coward]

These manufacturers could just tell the Trump administration to go fuck themselves if they wanted.

What are they going to do, put them on the entities list and tell everyone they cant buy/sell components from/to Samsung, SK Hynix, and TSMC?

Oh there goes over half the worlds supply of electronics. Not like any of the remaining companies could replace them in the next 5 years.

[MiguelC]

While I do generally agree with your idea, I think the pressure from the US would most likely be financial - if huuuuuge fines were to be levied against the companies unless they’d stop selling to Huawei, they would have no option but to comply (under their own investors’ pressure)

[Anonymous Coward]

They could apply financial pressure, fining them, they could again tell them, go scew yourself. Then the US has 2 options, freeze their assets and take what they have in the US. Result, half the world's supply disappears, or just the US and they move off USD. The other option is sieze their assets / fabs in foreign countries, starting wars.

But investor interests would stop all this.

Silicon is the new oil, its what makes the world go round, oils days are numbered, without silicon the world will collapse. These companies can hold a lot of power, they can not be replaced quickly, especially if they work together.

[Anonymous Coward]

It would be real funny to see China stop exporting everything to the USA, and also to any country that supplied Chinese goods to America.

They wouldn't even have a pair of undies to wear in 6 months, and they'd be walking around in bare feet.

Do you think they'd wake up when they had no first world luxuries any more, or are they too stupid?

[Anonymous Coward]

Counterproductive

For a short term hit to Huawei, this will give a fillip to the Chinese domestic chipmakers to up their game drastically and flood other world markets. It will hurt Koreans the most in the long run when China becomes self sufficuent. UK 5G dreams will remain just that, dreams.

Meantime, whats stopping other chinese buyers uptaking the extra stock and passing on to Huawei ? ( Sanctions busting). Happens all the time.

And consumers will be the poorer for the shenanigans.

Trump loads pistol, aims at both feet and..... BANG !

[Lon24]

Re: Counterproductive

China has always been a disrespector of IP. But now they must feel a moral and financial obligation to take what they want - and take it quick. Who doesn't doubt their ability to do so?

The US will rue the day Trump signed that order. Unless, of course, they do the decent thing on November 3rd. But then Biden even if he wins clearly will still be hidebound in reversing the order without be labelled as a Chinese poodle.

It's not good.

[Anonymous Coward]

Re: Counterproductive

Same argument used to be used against Japan.

Nothing more than jealousy, that they can't produce quality goods at a cheap price.

All America produces is rubbish with built in obsolescence, and planes that crash, because their beancounters wanted to save $10 per plane.

[Anonymous Coward]

Re: Counterproductive

Are there any estimates how far China is behind the US, Japan, Taiwan and South Korea in developing its own processors, memory, graphics doohickeys and the like?

[Yet Another Anonymous coward]

Re: Counterproductive

The real question is how far they are all behind the Netherlands.

I would have loved to seen the Eu steel companies react to Trump tariffs by buying ASML and deciding that they weren't going to sell to Intel anymore

[Anonymous Coward]

China isn't behind.

Huawei is more advanced in 5G and other tech.

China has a larger Military/Navy than America.

China has more nukes than America.

China has a better/cheaper manufacturing industry than America.

Trump's war is about keeping USA's perceived "top of the pile" propoganda alive.

Trump fiddles while America (literally) burns.

The US empire is on the verge of collapse.

Time to wake up and smell the roses.

[Mark Exclamation]

Re: China isn't behind.

You are Xi Pingpong (or one of his paid/coerced trolls) and I claim my $5.

[Yes Me]

Re: China isn't behind.

What is definitely happening now is that China is working hard -- very hard -- to bring its semiconductor design and manufacturing supply chain up to standard. It may take them a few more years, but Trump has taught them a lesson and they have learnt it: don't rely on foreigners for your basic hi-tech. So in the end, the US and other "developed" countries will be the losers. Meanwhile, Huawei may have a few tricky years but they will come back stronger than ever. By then, Trump will be irrelevant except to historians.

[Anonymous Coward]

Re: China isn't behind.

I agree China are working very hard to catch up with Taiwan, Korea. and the USA. They may succeed, they may not, we don't know. The semiconductor industry is a massive potential money pit, and you need to be able and willing to ride out the tough times. I'm not sure I'd built multiple fabs when they cost north of $15b each ....

[Anonymous Coward]

Re: China isn't behind.

If China's xenophobia was more restrained, it's economy more open to foreign competition, if the CCP didn't insist on centrally controlling all the foreign currency earned through exports so it could keep the yuan undervalued, if domestic Chinese migrant workers had full rights of citizenship and a path to organized labor, if the PLA wasn't driving so much of foreign and domestic policy in Hong Konk, Taiwan, the Himalayas, the South Sea, the East Sea, and most of all if China has made some inroads into Democracy itself, I would be more inclined to believe in China's continued economic rise.

But sadly that is not the case. No doubt "don't rely on foreigners for your basic hi-tech" and "China is working hard -- very hard -- to bring its semiconductor design and manufacturing supply chain up to standard" will succeed to some extent but conversely China has alarmed trading partners into believing "don't rely on China for your basic manufacturing or high tech".

"Freedom" in China has been the economic liberation opportuned by freely accessible export markets, mainly in the advanced democracies, and it has been source of an amazing spring of entrepreneurial energy and creativity. That "Freedom" is a real kind of freedom even without democracy, that can't be denied. But without the same access to the markets of the democracies, will China be able to maintain that level of economic opportunity through greater domestic consumption? That, I fear, is not possible, due to China's hierarchical and centrally planned system. Not without even equal rights for Chinese citizens living in the same cities, and without democracy to push for equity. And as troubles mount, the country will become more dependent upon the PLA to instill a sense of national pride, which will demand more resources and result in further friction with neighbors.

[confused and dazed]

Re: Counterproductive

5 years maybe

[Anonymous Coward]

I think I approve

Japan used to be dominant in semiconductor memories. In my 30+ years of working in this sector, I first saw Japan partner with Korea, then Korea start to compete and eventually over-take and ultimately decimate Japan's icons. I've also visited SMIC when they were partnering with another DRAM manufacturer. It's a great way for a country to acquire IP, but it is short termist.

Putting aside the CCP's aggressive stance with the Spratleys, HK and Xinjiang, and talking purely about their business practices, maybe action like this will make the table more even ? As much as I think Trump is loathsome, this is a risky approach, but it's not crazy.

A/C because I love visiting the people in both the USA and China, but dislike their leaders policies ....