A smartphone brand with deep historical ties to Huawei is set to re-enter the Australian market, with Harvey Norman preparing to launch a range of Chinese-made Honor devices next month.

The move raises fresh questions about Communist China state-backed involvement, supply-chain transparency, and potential security concerns.

Honor, originally established in 2013 as a sub-brand of Huawei, was spun off in 2020 after Huawei was effectively forced out of several Western markets, including Australia, amid national-security concerns.

The Honor business was sold to a consortium led by Shenzhen Zhixin New Information Technology — a group comprising more than 30 companies connected to the Shenzhen Smart City Technology Development Group, which is controlled by the municipal government of Shenzhen under the Chinese Communist Party.

New Distributor, Old Questions

In Australia, Honor will be distributed through Shenzhen Aisidi Company. Industry insiders say Honor approached several local distributors before securing Aisidi, but many walked away due to what they described as highly unfavourable commercial terms.

One distributor told ChannelNews the offer was “ridiculous,” saying Honor expected distributors to shoulder nearly all risk — including marketing costs, retailer margins, and inventory — while only providing “a good margin” on bulk handset purchases. The distributor compared the proposed model to how Oppo operates locally.

Research into ownership structures also shows that private firms holding up to 44% of the shares in the Australian distribution entity have links to state or government-connected organisations. However, publicly available data does not clearly disclose which entities are directly state-owned or state-controlled.

State-Linked Ownership Continues

What is clear is that Honor’s parent consortium, Shenzhen Zhixin New Information Technology, remains connected to Chinese state-backed interests. With the conglomerate overseen by the Shenzhen municipal government, Honor is now effectively controlled by a state-owned or state-supported enterprise — a significant shift from its former Huawei ownership, but one that may not quell longstanding security concerns.

Huawei devices and network equipment were banned from Australia’s 5G infrastructure due to national-security risks. Industry observers suggest Honor may be attempting to avoid similar scrutiny by being selective about which media outlets it briefs, as well as distancing itself publicly from the Huawei brand.

AI-Powered Devices and a “Long-Term Commitment”

Despite this, Honor is pushing ahead with its Australian relaunch, touting new models equipped with Chinese-developed AI technologies.

“We’re entering the Australian market with a strategic, long-term commitment to build a brand that’s here to stay, contribute to the local tech landscape, and support customers for years to come,” said Matt Segafredo, Sales Director at Aisidi Australia.

He added that Honor is partnering with “leading retailers and carriers” and establishing an extensive after-sales support network designed to reassure customers. However, Segafredo did not name any carrier partners.

Carrier Support Still Missing

Industry sources indicate that no major Australian carrier has committed to stocking Honor devices. JB Hi-Fi — the country’s largest mobile phone retailer — has also not come on board, according to insiders.

Harvey Norman remains the only major retailer confirmed to carry Honor smartphones when the brand officially relaunches next month.