Biden Administration approves Huawei to buy auto chips

According to two sources familiar with the matter at hand, the Biden Administration has approved license applications worth hundreds of millions of dollars for blacklisted telecom company Huawei to buy chips for its growing auto component business.

While the Trump Administration had imposed trade restrictions on the Chinese company following non-compliance of US sanctions, the Biden Administration has been largely generous and has only denied selling 5G chips to the Chinese blacklist company.

According to sources, in recent weeks, the Biden Administration has granted licenses authorizing suppliers to sell chips to Huawei for vehicle components including video screens and sensors.

The development comes at a time when Huawei has pivoted its business away from smartphones towards items that are less susceptible to U.S. trade bans.

While auto chips are generally considered as not being sophisticated, a source revealed that the Biden Administration is granting licenses for chips in vehicles that may have other components with 5g capability.

When asked to respond to requests for comments, Huawei’s spokeswoman declined comment on the licenses, but said: “We are positioning ourselves as a new component provider for intelligent connected vehicles, and our aim is to help car OEMs (manufacturers) build better vehicles.”

Licenses are generally good for four years.

According to Richard Barnett, chief marketing officer at a global electronics consultancy called Supply Frame, the Chinese company is in the “early innings” of trying to invest in the $5 trillion automotive market that has large potential growth both inside and outside of China.

“Cars and trucks are now computers on wheels,” said Barnett, “That convergence is what’s driving Huawei’s strategic focus to be a bigger player in that area.”


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