Huawei Responds to Claim It Set Up Precision Manufacturing Company Worth Almost $100 Million: “We Don’t Produce Chips”

Chinese business inquiry platform Qichacha showed on Tuesday that telecommunications and electronics leader Huawei has established the Huawei Precision Manufacturing Co., Ltd., with Li Jianguo as its legal representative and a registered capital of 600 million yuan ($94.17 million).

The manufacturing scope of the newly established company includes optical communications equipment, optoelectronic devices, discrete semiconductors, and more. The venture is 100% controlled by Huawei, causing various market commentators to speculate that the tech giant might be preparing to make its own chips.

Yicai learned from company insiders that the Huawei Precision Manufacturing Co., Ltd. is capable of a certain scale of mass production and small batch trial production, but is mainly used to meet the system integration requirements of Huawei’s own products.

The insiders said: “We don’t produce chips. Our main business is the precision manufacturing of some core devices, modules and components of Huawei’s wireless and digital energy products, including assembly and packaging.” They also said that the “discrete chip devices” mentioned in the business scope mainly refer to the packaging and testing of discrete devices.

There has been a lot of buzz surrounding Huawei’s possible chip manufacturing since last year. In September, Xu Zhijun, the rotating chairman of Huawei, told reporters at a media conference that the firm has been relying on chip inventory to survive, and is also trying to solve the chip manufacturing problem, but it depends on the joint efforts of China’s semiconductor industry chain, and it will take great efforts and a long time to solve the problem.

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At present, the company owns HiSilicon, a chip design company based in the Chinese mainland, founded in April 2004. The company was formerly known as Huawei Integrated Circuit Design Center, which was founded in 1991, headquartered in Shenzhen, Guangdong Province. Now it is the largest chip design company without a fab in Chinese mainland. The main products are wireless communication chips, including mobile smartphone system MCU with WCDMA, LTE and other functions.