The dangers and opportunities behind the Huawei supply chain ban

The "danger" and "opportunity" of Huawei's supply chain. Huawei's inclusion in the "Entity List" by the United States this time has brought difficulties and obstacles, but also brought opportunities to Huawei and its domestic supply chain. On the one hand, Huawei has long had a plan for the crisis and began to increase its stocking last year. The stocking cycle of core chips and components is sufficient to cover the supply of subsequent products for half a year to two years. On the other hand, under external pressure, it will also accelerate Huawei's migration to the domestic supply chain. At present, in the fields of optics, display, precision manufacturing, etc., localization has been basically achieved; in the semiconductor field, Huawei's HiSilicon and other high-quality domestic manufacturers have been able to achieve partial domestic substitution, such as mobile phone SoC, baseband, RF transceiver modules, etc. While being partially self-sufficient, core components such as storage, RF, and analog ICs are still mainly imported and subject to others. This crisis is expected to accelerate the introduction of the domestic supply chain. Domestic high-quality semiconductor manufacturers are expected to complement HiSilicon under external pressure, creating a stronger Huawei and domestic supply chain.

Optics, display, precision manufacturing and other links have basically achieved localization. Now that smartphones have entered the stock era, major mobile phone manufacturers are looking for new mobile phone performance innovations to seek differentiated competitive advantages and sales breakthroughs. With the rapid rise of Chinese mobile phone manufacturers represented by Huawei, the localization of the industrial chain will be a long-term trend, and domestic manufacturers will gradually become an indispensable force in the global mobile phone supply chain. Taking the latest P30 series as an example, domestic suppliers include lenses: Sunny Optical; CMOS image sensor: OmniVision Technology (Well Group); periscope camera module: Sunny Optical, Luxshare Precision; prism: Sunny Optical, Crystal Optech, Lida Optoelectronics, etc.; TOF supply chain: Sunny Optical, O-Film, Crystal Optech, etc.; fingerprint recognition: Goodix, Silead; fingerprint module: O-Film, Q Technology, etc.; camera bracket: Changying Precision; NFC antenna wireless charging: Luxshare Precision, Micro-Best, Xinwei Communication; screen: BOE.

Huawei's semiconductor supply chain review: Among Huawei's five core CPU, GPU, ADDA, storage and RF devices, CPU, GPU, ADDA, HiSilicon has been conducting research and development for many years, and its products have gradually been put into use; GPU: Jingjiawei; Storage: The largest in terms of usage, with a purchase level of tens of billions of US dollars, and it is expected to double in three years. Currently, mainstream storage DRAM supports Hefei Changxin (GigaDevice), and NAND supports Yangtze Memory. Niche storage GigaDevice and ISSI (Beijing Junzheng intends to acquire) have already entered the market and are expected to increase in volume soon; FPGA: Zigbee Guangtongchuang (Ziguang Guoxin), Anlu Information (Silan Microelectronics has invested); analog chips and sensors: Will Technology + OmniVision Technologies, Shengbang Electronics, Siledi; power semiconductors: Wingtech Technology (Ansem Semiconductor), Silan Microelectronics, Yangjie Technology; RF chips: Sanan Integrated Circuit (San'an Optoelectronics), Shandong Tianyue; Resistors, Capacitors, and Inductors: Sunlord Electronics; Foundry and Packaging and Testing: SMIC, Changdian Technology, Huatian Technology, Tongfu Microelectronics; Connectors and Antennas: Luxshare Precision, Ehua Technology, Microchip, and Elec-Tech; IC substrates and test boards: Xinsen Technology.