Tariffs and moves against Huawei could make it harder for telecom-gear makers to buy supplies, hindering 5G growth in the U.S.
China-based Huawei is the world’s biggest telecom-equipment company and holds more patents for 5G standards than any other company. Photo: Qilai Shen/Bloomberg News By Stu Woo Updated May 28, 2019 10:58 p.m. ET The Trump administration’s offensives aimed at frustrating the 5G ambitions of China and mobile-technology giant Huawei Technologies Co. threaten to impede America’s wireless ambitions, too.
A Commerce Department measure, designed to hinder Huawei from buying critical components, would potentially make it harder for American and European telecom-equipment makers to buy certain supplies as well, Western industry executives said. “When there are disturbances in the supply chain, it will impact the whole industry,” said Bengt Nordström, who runs Northstream, a consulting firm that helps wireless carriers buy equipment.
An official at one Silicon Valley supplier of Huawei said a slowdown in its manufacturing was possible and could result in short-term revenue losses. But the supplier expects rival telecom-equipment makers, such as Cisco, Finland’s Nokia Corp. , Sweden’s Ericsson or even China’s ZTE Corp. , which currently doesn’t face the same Commerce Department restrictions, to step up purchases of popular components that Huawei can’t buy.
Earlier this month, executives at Cisco, which makes routers and switches, said they have shifted some, but not all, manufacturing out of China since last summer, when the 10% tariffs were introduced. Chief Executive Chuck Robbins said that after the tariffs went up to 25%, the company raised prices for some products.
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