Home / Business / According to Huawei founders, US sanctions are not his worst crisis

According to Huawei founders, US sanctions are not his worst crisis

SHENZHEN, China (AP) – Huawei's founder, Ren Zhengfei, was out of sight for decades when his company grew to be the largest manufacturer of network equipment for telephone service providers, outperforming Apple as the second largest smartphone brand.

Now Ren renounces this anonymity when Huawei Technologies Ltd. against the recent threat of its success mobilized: US sanctions and warnings that it is a security risk.

The billionaire involved in the Trump administration's fight with China for technology is a 75-year-old former army engineer who has worked his way out of child poverty. He has survived the competition that has driven Western competitors out of the market, overshadowing financial disaster and workload, and considering suicide.

He sees American pressure as the latest in a series of tests that hardened him and his company.

"Huawei has been suffering for three decades and has no joy," Ren said in an interview. "The pain in each episode is different."

The final episode has a personal dimension: Ren's daughter, Huawei's Chief Financial Officer, has been arrested in Canada on US charges of violating sanctions against Iran.

Ren and his company have spent almost a decade investigating US allegations that might facilitate Chinese espionage. The Trump administration tightened pressure this year by restricting the sale of US technology to Huawei, and urging European and other allies to shun the company as they prepared to launch next-generation telecommunications networks.

The escalating conflict with Washington has changed Ren from an admired but rarely seen businessman worth an estimated $ 3 billion is one of China's best-known personalities.

He belongs to the generation of entrepreneurs who founded China's first private companies of the communist era in the 1

980s. They moved in a changing, state-dominated landscape and overcame the lack of money and technology to create industries that are now expanding overseas.

Despite his success, Ren talks like a beginner and fears loudly that employees may feel too comfortable.

] He writes letters urging employees to prepare for the worst, said Nicole Peng of Canalys, an industrial research firm.

"He is still very important to dictate this urgency," Peng said. "He always talks about survival: make sure you survive."

Tian Tao, co-author of "The Huawei Story," says Huawei's corporate culture is due to Ren's education in Guizhou, one of China's poorest regions.

] Ren was educated by a schoolteacher who said he fed seven children with a monthly wage of 40 yuan (US $ 6). His father was criticized as a capitalist and imprisoned at a certain time in a cowshed.

When Ren was a teenager, the ruling party launched the big leap forward, a catastrophic campaign to become an overnight powerhouse. At least 30 million people died in the following 1959-61 famine.

Ren's mother declared that nobody would die and split each meal into nine portions, one for each family member, Tian said.

"All nine people survived," Tian said. "His mother's" meal system "had a big impact on him."

According to Huawei's ethos, Chinese citizens own half of their 180,000 employees. According to Ren, the company has no external owners, neither government nor private.

According to Huawei, Ren's property has declined to 1.14% as more shares were distributed to employees, the Hurun report following China's rich , said its net assets are still $ 3 billion, up 25% from 2018.

Ren attributes his success to focus on details, not education, he said, if he had not graduated from university he could be a pig breeding champion or a noodle factory

"Do not think I had a great ideal as a kid." When I was young, I wanted more steamed buns, white We did not have enough, "Ren said.

"Poverty did not give me the elements for success," he said. "That was not inevitable."


After studying engineering, Ren entered the army in the 1960s and was sent northeast to build a textile factory. He slept outdoors in a cold of -28 ° C.

Ren said he was fortunate in the mid-1970s when Chinese leaders sought to revive technological development after the ultra-radical Cultural Revolution. He built a measuring tool based on a description of a technician who had seen a similar device abroad.

"The country looked for cases in which science and technology proved useful, and my gizmo was exaggerated into a great invention," said Ren

He founded Huawei in 1987 after his military post had been eliminated and left thus an entrepreneurial way, which he had not wanted. The company sold imported telecommunications equipment when it faced its first crisis: the supplier was taken over by a competitor. Huawei went to work to develop its own products.

Huawei has one of the largest corporate research budgets in the world, indicating that spending will rise 20% to $ 17 billion this year.

This has helped to limit the impact of potential access loss to US components and technology. Company executives say they are removing products made in the US from products, but expect the smartphone sales to suffer as the company loses access to Google's maps and other services I can not afford it yet to start over again after spending the savings of his family on starting the business.

He said he tried to secure Huawei's long-term survival through a system of joint decisions in which a three-man team alternate six-month term as chairman.

Nevertheless, he gained the reputation of a strong, even autocratic decision-maker. This was underlined by an internal struggle in 2000 that nearly broke up the company.

"Today's crisis is one-tenth or one percent of the pressure at that time," said Ren.

Others wanted Huawei to invest in the company's personal cell phone service or PHS, which became a cost-effective alternative to mobile phones. Ren turned it down to distract attention from a bigger goal in the development of third generation mobile phone technology.

Ren received reports from managers almost every day urging him to support PHS as 3G development bills piled up. It was expected that the regulators would already approve 3G in 2003. Huawei invested 6 billion yuan (US $ 750 million) before the first Chinese licenses were issued in 2009.

"Every time I saw a report, I was in pain," Ren said. "Maybe my depression got worse then."

Tian, ​​his biographer, told Huawei employees that Ren, who could not sleep, called loudly and worried about receiving a monthly payroll bill of $ 300 million ($ 50 million). could pay. 19659002] "When Ren Zhengfei spoke with staff six or seven years ago, he revealed a secret: He had several suicidal thoughts," said Tian, ​​a Huawei consultant and co-director of the Ruihua Innovation Research Institute at Zhejiang University.

] Spotlight

The staff joked that Huawei was the largest company that no one had ever heard of.

Ren gave his first press interview only in 2013, a year after the company became its first smartphone by introducing consumer brand.

In 2016, he became a social media sensation when a photo was circulated waiting for a taxi at Shanghai airport that was unrecognized by other travelers. Online comments have expressed his admiration for avoiding private jets and other riches.

At an age when most Chinese business leaders had long retired, Ren took on a new role as Huawei's public face after Meng was arrested in December 2018 in Vancouver. Huawei launched a charm offensive to defuse Western suspicions.

Since January, Ren has been giving reporters and television crews to Shenzhen, a former fishing village near Hong Kong that has developed into a city, interviews lasting up to two hours from 15 million people and a Chinese technology center , Huawei's neighbors include Foxconn, which compiles the iPhones from Apple, and Tencent, the operator of the popular social media service WeChat.

Ren is known for speaking so bluntly that colleagues claim that they have limited contact with customers. In public, however, he is balanced, even friendly.

Despite the arrest of his daughter, he expresses his admiration for American society. He avoids criticizing Washington and says he does not want Beijing to take revenge on US sanctions.

Ren, a ruling party member, tried to defuse security concerns by promising in January to defy official demands to divulge the secrets of foreign customers.

] Huawei is together with Nokia Corp. and LM Ericsson lead 5G. It is intended to support self-driving cars and other futuristic applications. However, this greater reach makes 5G politically sensitive.


Ren is still CEO, but has retired from the day-to-day running of the business. He says he has no plans to retire because his only hobby is work. He promotes the company's management culture and discusses issues with employees invited to tea in their office.

Ren put an unusually high value on making Huawei independent and developing his own technology, Peng said. She said that differentiates it from companies like Lenovo, the Chinese manufacturer of computers and smartphones, who use more external suppliers.

The company has released a smartphone operating system that can replace Google's Android if needed. It manufactures its own processor chips, but continues to rely on US suppliers of high-end products.

"They make things from scratch," Peng said. "I think that's the influence of the founder."

Ren rejects suggestions that Huawei might be able to address against the fears of the West by selling shares to the public and joining a stock exchange.

"There are few examples of large public companies and strong capital must be greedy," he said. "Because we are a private company, we remain very committed to our long-term ideals."

He admits that his daughter's arrest is anything but the first time his family has made sacrifices for Huawei.

Ren said when Meng used her mother's last name and his other daughter and son were children was away from home in the army and 11 months a year, and worked 16-hour days when he founded Huawei.

"I think my relationship with everyone was not very close, especially to my youngest daughter Father, I feel obliged to them, "said Ren." Of course, maybe after my retirement I'll do my best to make up for that. "

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