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US gives Huawei approval for auto chips licences as embattled smartphone maker pivots to smart cars

  • The licences, worth hundreds of millions of dollars, will give Huawei access to chips needed for car screens and sensors, which are not considered sophisticated
  • US sanctions have forced Huawei to retreat from its once dominant position in the smartphone market and look for new areas of growth

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The Arcfox Alpha-S electric sedan, manufactured by BAIC Group's BAIC Motor Electric Vehicle Co and equipped with Huawei's HI smart car platform, during an unveiling event in Shanghai on April 17, 2021. Photo: Bloomberg
Reuters
US officials have approved licence applications worth hundreds of millions of dollars for China’s blacklisted telecommunications company Huawei Technologies Co to buy chips for its growing car component business, two people familiar with the matter said.
Huawei, the world’s largest telecoms equipment maker, has been hobbled by trade restrictions imposed by the Trump administration on the sale of chips and other components used in its network gear and smartphones businesses. The Biden administration has been reinforcing the hard line on exports to Huawei, denying licences to sell chips to Huawei for use in or with 5G devices.

But in recent weeks and months, people familiar with the application process told Reuters the US has granted licenses authorising suppliers to sell chips to Huawei for such vehicle components as video screens and sensors. The approvals come as Huawei pivots its business toward items that are less susceptible to US trade bans.

Auto chips are generally not considered sophisticated, lowering the bar for approval. One person close to the license approvals said the government is granting licenses for chips in vehicles that may have other components with 5G capability.

Asked about the automotive licenses, a US Department of Commerce spokesperson said the government continues to consistently apply licensing policies “to restrict Huawei’s access to commodities, software, or technology for activities that could harm US national security and foreign policy interests”.

The Commerce Department is prohibited from disclosing licence approvals or denials, the person added.

A Huawei spokeswoman declined to comment on the licences, but said: “We are positioning ourselves as a new component provider for intelligent connected vehicles, and our aim is to help car OEMs (original equipment manufacturers) build better vehicles.”

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