Huawei is selling its partner company Honor Phone business – Honor, Huawei’s sub-brand will soon remove the tag of Huawei from its parent company to operate its business properly, report. Unfortunately, Honor suffered huge losses due to its reduced sales after American companies refused to work with Huawei and therefore unsupported. To deal with that issue, Honor made a big decision about its ownership.
Huawei’s downfall after U.S. ban
Since the U.S. government had banned Huawei and consequently ordered American companies to no longer negotiate with Huawei, sales of Huawei smartphones have dropped dramatically. Eventually, the company has been unable to manufacture its own Kirin chipsets since then and even no purchase was possible due to strict rules.
On the other hand, Google has also removed its Google Play services from Huawei devices, and therefore, Huawei has to survive with its own “App Gallery”. After analyzing all of these issues, Honor made the wise decision to get rid of Huawei and get its position back in the market.
How Honor was affected after Huawei’s ban in the United States
As a subsidiary company, Honor used to purchase all of its manufacturing materials and technology material from Huawei. But after the U.S. restrictions, both Honor and Huawei depended on features already made, as they are now unable to do business in the U.S. But today, Huawei is facing major problems with the mass production of its Kirin chipsets.
As a result, Huawei is preparing to sell Honor to a new company, Shenzhen Zhixin New Information Technology Co. After that, Huawei will not engage in any business with Honor and will stop exchanging technical things with it.
According to our opinion, the decision to leave Huawei behind is a smart move by Honor to gain market share again and make reasonable profits. The honor was doing a great job in the smartphone industry before the U.S. ban but was heavily impacted by American sanctions. Hopefully, after splitting from Huawei, Honor will return to its previous position and be able to bring innovative devices to the market.