Wednesday, September 9th 2020
Samsung and SK Hynix to Impose Sanctions Against Huawei
Ever since the Trump administration imposed sanctions against Huawei to stop it from purchasing parts from third-party vendors to bypass the ban announced back in May, some vendors continued to supply the company. So it seems like some Korean manufacturers will be joining the doings of the US government, and apply restrictions to Huawei. According to the reports of South Korean media outlets, Samsung Electronics and SK Hynix will be joining the efforts of the US government and the Trump administration to impose sanctions against Chinese technology giant - Huawei.
It is reported that on September 15th, both Samsung and SK Hynix will stop any shipments to Huawei, where Samsung already stopped efforts for creating any new shipments. SK Hynix is said to continue shipping DRAM and NAND Flash products until September 14th, a day before the new sanctions are applied. Until the 14th, Huawei will receive some additional chips from SK Hynix. And it is exactly SK Hynix who is said to be a big loser here. It is estimated that 41.2% of SK Hynix's H1 2020 revenue came from China, most of which was memory purchased for Huawei phones and tablets. If the company loses Huawei as a customer, it would mean that the revenue numbers will be notably lower.
Sources:
@chiakokhua (Twitter), Tech News Taiwan
It is reported that on September 15th, both Samsung and SK Hynix will stop any shipments to Huawei, where Samsung already stopped efforts for creating any new shipments. SK Hynix is said to continue shipping DRAM and NAND Flash products until September 14th, a day before the new sanctions are applied. Until the 14th, Huawei will receive some additional chips from SK Hynix. And it is exactly SK Hynix who is said to be a big loser here. It is estimated that 41.2% of SK Hynix's H1 2020 revenue came from China, most of which was memory purchased for Huawei phones and tablets. If the company loses Huawei as a customer, it would mean that the revenue numbers will be notably lower.
13 Comments on Samsung and SK Hynix to Impose Sanctions Against Huawei
If not, SKH and the other chaebols are going to take a long hard look at whether it makes financial sense to continue operating in the USA, or just pull out and continue to trade with China. Of course, if that happens, the only real losers will be US consumers... again.
"Samsung Electronics and
HuaweiSK Hynix* will be joining the efforts of the US government a"Even if chaebol cease operation in US, due to the fact that their fab also use US technology, it will be difficult to procure completely homebrew replacement, that doesn't rely on US or its allies.
That being said, current SK government is pretty pro-china, with sufficient capital investment from SK and Chinese government, I suppose it is a possible scenario, albeit unlikely.
Worth noting that in this hypothetical scenario, Samsung will still have to compete with Huawei (and numerous ODM/OEM) for Chinese market, unless there are major incentive from China, this scenrio is highly unlikely.
Agreed that they will be crippled, and hard, but I'm pretty sure they will survive with the domestic market. From what I have seen, they will turn to other markets where sanctions are not targeted.
FTR, despite using a Huawei phone, I have no love for the company. They pretty much started the modern Chinese business culture of offering ludicrous bonuses to staff which requires people to work to life-threatening exhaustion to achieve them.
Samsung are big, but then again, losing so much revenue isn't going to help their bottom line either.
If this absurd trade war continues it's going to have a really, really serious global impact.
Wars have been fought for far less.