U.S. based memory-chip maker Micron Technology Inc has reportedly resumed shipping chips to China-based Huawei Technologies Co Ltd after almost a month of ordeal citing Huawei ban imposed by the U.S. Government last month.
Based in Idaho, Micron has resumed shipping memory chips to Huawei after it found a provision or say a loophole in the ban imposed by the Department of Commerce and the U.S. Government which released an ‘entity list’ banning Huawei and 67 other companies from acquiring any U.S. based technology or goods without prior approval which in case of Huawei, is a NO on the face without any doubt.
Reuters posted a report where Sanjay Mehrotra, Chief Executive at Micron, stated how the chip making giant has started shipping products to Huawei that aren’t subject to the export administration regulations while complying with the ban imposed by the U.S. government. He further added that having a situation like Huawei, it is not yet predictable whether what volumes or time periods they will be allowed to ship products before a full-on imposition is in place in August.
According to Micron, its lawyers and attorneys found out a provision within the imposition which dictates that U.S. based companies with products having 25% or more of U.S-originated materials or technology are subject to ban which leaves a lot of room for other manufacturers to supply products such as in the case of Micron, it is shipping memory cards while Intel Corp has also added to the list of companies doing the same where the chipmaker has also resumed shipping some products.
The report further adds how Huawei is estimated to suffer a cost of $30 billion in revenue this year due to the ban where the company has been charting the list of top manufacturer in terms of items shipped overtaking Apple while lagging a little behind South Korea based Samsung. It also stated shipping 100 million smartphones as of May 30, which is less than two quarters which is enough to convey the scale of monstrosity the China-based company is true.
However, Huawei currently has stockpiles of components that it can use to manufacture phones for over a year before finding substitutes and alternatives of components that are sourced from the U.S. if this Huawei ban goes through in August.
Micron listed how the ban could cost the chip making giant almost $200 million in missed sales during the third quarter of this month. The report further states that Micron did found the solution by its own and without any interference from any other company or the U.S. government parse. It also added that other companies can also work around the ban to find provisions that allow them to ship products and do business with Huawei while attaining compliance with the imposition as well.
