Samsung Electro-Mechanics Co., an electronic components maker affiliated with Samsung Electronics, has said it will shut down one of its Chinese units that produces high density interconnect (HDI) substrates due to low profitability.
Kunshan Samsung Electro-Mechanics Co. in Jiangsu, China, will halt production and sales, Samsung Electro-Mechanics said, adding that it also plans to sell assets of the Chinese unit.
Kunshan Samsung Electro-Mechanics produces HDI, a type of printed circuit board used in electronic devices, including smartphones and laptops, Yonhap news agency has reported.
The company has reportedly been struggling to make a profit in recent years due to fierce competition from low-cost Chinese and Taiwanese rivals.
To help the Chinese unit wind up its business, Samsung Electro-Mechanics will purchase 383.6 billion won worth of new shares issued by Kunshan Samsung Electro-Mechanics so the company can pay off its debts.
Samsung Electro-Mechanics has been expected to pull away from the HDI business due low profitability. The company previously announced its HDI production line in Busan will be transferred to Vietnam. (IANS)
In a breather to the Chinese telecom equipment and smartphone giant Huawei, the Pentagon has blocked the Commerce Department-backed ban on sales that make it harder for US-based companies to sell equipment to the handset maker, the media has reported.
The US Department of Commerce had put Huawei on the “entity list” in May 2019, thus, preventing US firms from conducting business with the company unless they obtain a specific license, citing national security concerns with the Chinese telecommunications giant.
The Commerce Department’s efforts to tighten the noose on Huawei Technologies Co. is facing a formidable obstacle: the Pentagon. Commerce officials have withdrawn proposed regulations that would make it harder for US companies to sell to Huawei from their overseas facilities following objections from the Defense Department as well as the Treasury Department, people familiar with the matter said, The Wall Street Journal reported on Friday.
The Commerce Department has subsequently issued temporary licenses to delay that designation, but companies have already begun finding ways to continue selling equipment to Huawei without falling afoul of Commerce penalties.
Meanwhile, Huawei’s latest smartphone Mate 30 Pro, unveiled in September, doesn’t contain American components. The flagship smartphone competes with the likes of Apple’s iPhone 11, which was also unveiled in September.
In the wake of the US ban, Huawei is sourcing audio amplifiers from the Netherlands’ NXP rather than Texas-based Cirrus Logic, and relying entirely on its own HiSilicon semiconductor division for Wi-Fi and Bluetooth chips rather than Broadcom. It’s using other firms, like Japan’s Murata and Taiwan’s MediaTek, for other parts previously supplied by US manufacturers, The Verge had reported in December.
However, Huawei has not been able to divest itself of American suppliers entirely.