Flex resumes shipments for ‘majority’ of Huawei products

Singapore-based electronics contract manufacturer Flex has resumed shipments to Chinese phone and telecom equipment maker Huawei, whose business has been disrupted after the United States put it on a blacklist over national security concerns.

In a statement to ET, aFlex spokesperson said: "We have resumed shipments for the majority of products we assemble for Huawei globally," without giving details about specific products or its Indian operations, which include manufacturing units near Chennai and in neighbouring Andhra Pradesh.

Huawei did not reply to an email seeking response to the resumption of supply from Flex.

ET reported last month that Flex had halted supply to Huawei after the US added the Chinese company and its affiliates to the Entity List, following an indictment by a US court on charges, among others, of doing business with Iran.

Flex counts among a clutch of vendors — manufacturers, chip designers and other component suppliers — that Huawei relies on to conduct its global business.

The resumption of supply should be a relief to the Chinese telecommunications company, and the roadmap for Huawei will become clearer as it crosses the 90-day reprieve given by the US to keep servicing customers, people aware of the developments said.

Huawei has struck a deal with Russian telecom company MTS to conduct 5G trials. Huawei is deemed to play a crucial role in China’s acceleration of 5G technologies even as Western telecom operators race ahead in offering 5G services in select regions.

India’s telecom minister Ravishankar Prasad had termed the prospect of allowing Huawei to conduct 5G trials in India a “complex question, involving security issues.”

A government official who is aware of the deliberations at the Department of Telecommunications regarding Huawei’s access to the 5G trials told ET that a decision would be taken after the issue is looked at from the security, scientific and technical angles.

According to Counterpoint research, Flex accounted for a tenth of global electronics manufacturing services globally, trailing Taiwanese competitors Pegatron and market leader Foxconn, which holds over 50% share and manufactures for American phone maker Apple.

Huawei, according to Counterpoint, gets nearly 23% of its manufacturing done from EMS companies such as Flex and Foxconn.