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Home / Business / The Huawei ban in the US could backfire and hurt Apple

The Huawei ban in the US could backfire and hurt Apple



Huawei had problems for a few days after being blacklisted in the US. But now, people are worried that the treatment of the Chinese technology company could be counter to one of the great success stories of American companies.

Apple may fall victim to a retaliatory movement in China. There are signs that Chinese citizens are ready to turn their backs on the company, and analysts believe fragile iPhone sales in the country may be hit again.

UBS sent a notice to customers on Wednesday exposing the risk to Apple if national opinion turned against the company over US treatment of Huawei.

"At times, foreign consumer goods in China have been adversely affected by nationalist sentiment (which may be exacerbated by social media)," said UBS.

"This could have been a factor in the poorer performance of the Apple iPhone in China in the fourth quarter of 1

8. Although this is difficult to quantify, we see this as a risk to Apple and the supply chain."

Read More : Google offers Huawei a short respite by putting its Android lock on hold.

Business Insider reported last week on the "intense discussion" in Chinese social media about the steps taken by US President Donald Trump against Huawei. According to BuzzFeed News, users of the microblogging website Weibo called for a boycott of Apple products.

This is not the first time that the threat of an Apple boycott has been put on the market. Chinese citizens and companies promised to shun Apple goods after Huawei's Chief Financial Officer Meng Wanzhou was arrested in December.

The Nikkei Asian Review reported at the time that some Chinese companies even threatened to confiscate iPhones from their employees and punish those who bought them.

Hu Xijin, editor-in-chief of the state-run Global Times newspaper, says he is switching from an iPhone to Huawei because the Chinese company is being "unduly suppressed" by the US government.

In a tweet explaining the decision he added that he did not support a boycott. "There are many loyal iPhone users in China, and I believe they can freely decide which mobile phone brand to use," Hu said.

This was confirmed by Bryan Ma, vice president of client device research at research firm IDC Asia-Pacific. "There will be some who are nationalist and say no to American products, but there are many other users who do not care so much," he told the South China Morning Post.

But even a small change of mood towards Apple could do enormous harm to the company. Apple surprised watchers in January with a catastrophic profit warning announcing that Q1 sales would be more than 7.6% lower than expected, largely due to lower sales in China.

Apple's fate improved in China in the first three months of 2019, with CEO Tim Cook highlighting a winning bid last month, calling what he calls the "enhanced trade dialogue between the United States and China."

But relations between the US and China have dramatically worsened since then, and Apple has been re-caught in the crosshairs.


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