Huawei CEO Tries To Sell Chinese Spin, But He Forgot Half The Story

Last week Huewei consumer PR chief Candice Lester dialled up a pearly of a PR event, a questionable reseller to service Huawei’s questionable smartphone range and on top of this she got the Financial Review to spin the Corporate party line that all was honky dory in Australia.

Huawei Australia’s managing director Larking Huang told the AFR that the Company was here to stay and was not set to lay off staff despite a senior executive of the Chinese Company admitting in a telephone conversation with ChannelNews and heard by other people that things were not as Huang is claiming, Huang also claimed that sales of Huawei phones in Australia had “hardly” been affected.

When our original story appeared Huawei management did not deny claims that sales of their smartphones had fallen over 50% in Australia.

Huawei Australia’s managing director Larking Huang

Huang now claims that Huawei isn’t backing out of the Australian mobile phone market and is “staying put” he said.

He did admit that the company would release all its phones “as normal” though he was not clear on what operating system they would run.

Huawei has claimed they they are developing their own Chinese Made OS which will compete with Apple’s iOS and Android, the Company has given no assurances regarding security and whether the Chinese Government would have a say in the OS.

“We would love to use Android if we can, but if we can’t, we have a plan B.”

Called Hongmeng Huawei’s plan B is an home made operating system designed by the Chinese Company that will work on mobile phones as well as on PCs because Microsoft can no longer supply Windows 10 to Huawei for its notebooks.

Huang even bragged that Huewei Australia is increasing its headcount in Australia, and still planned to launch new models of all its phones, with or without the Android operating system.

He said “In this very difficult period, our partnerships with the carriers gives me a lot of confidence … this didn’t abandon us, and I don’t think they will,” Mr Huang said.

What he failed to tell the Financial Review was that Huawei has been forced to splash the cash with retail partners, buying shelf space with a major outlay of marketing dollars that are totally out of proportion to the falling sales of Huewei branded smartphones.

Then came a pearler of an answer with Huang claiming that Australian sales of existing Huawei phones had barely been affected by the US ban.

He referred to both US and Australian sales.

This is not what retailers are telling ChannelNews.

It was only a few months ago that Huawei were laying claim to the #3 slot in the Australian smartphone market a position that is actually held by TCL Mobile who also sell the Alcatel and Blackberry smartphones in Australia this is backed up by carriers such as Optus, Telstra and Vodafone.

When the CEO of TCL Mobile Sam Skontas called on Huawei to open up their books for an independent inspection which he claimed he would do with TCL mobile and sales of their popular Alcatel models both Oppo who have also claimed the #3 spot and Huawei refused the offer.

The biggest omission was the fact that new plants that were making Huawei smartphones are now being closed down months after starting production, because of the severity of the downturn following the ban by the US Government on Companies supplying Huewei.

The plant in Changsha is operated by a Company called Flex, previously known as Flextronics, which competes with Taiwan giant Foxconn and currently has more than 100 factories with 200,000 employees in more than 30 countries.

“From this March, the first stage of Flex’s manufacturing program began to experience difficulties,” the source said.

“As early as May, Flextronics had already halted production,” he told Caixin without giving details.

Before the US announced the resumption of some sales earlier this month, Huawei had said it expected to lose around $US30 billion in sales over the next two years related to the ban, none of this was mentioned in the AFR story.

According to the Wall Street Journal Huawei is planning to cut jobs at its U.S research and development subsidiary as the Chinese technology giant continues to struggle.

The cuts are expected to affect employees at Futurewei Technologies, a research-and-development subsidiary that employs about 850 people in states including Texas, California and Washington, according to the the WSJ.

Some workers have already been notified of the dismissals and additional cuts could be announced soon, the newspaper reported.

The Journal cited one of the people familiar as saying hundreds of people could lose their jobs, without providing an exact number. Another person said some of Huawei’s Chinese employees in the U.S. were offered the option of returning home and staying with the company, according to the report.