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A report by the South China Morning Post over the weekend alleged that Foxconn, the manufacturing giant best known in the West for assembling Apple’s iPhones, had recently stopped several production lines for Huawei phones after the company reduced orders for new handsets. The information came from anonymous “people familiar with the matter,” though whether this was a temporary pause or something more permanent wasn’t made clear.
Huawei didn't immediately deny the report, but it now claims it to be false. "Huawei refutes these claims. Our global production levels are normal, with no notable adjustments in either direction," a spokesperson said.
Since being placed on an entity list that bans US companies from doing business with Huawei without a license, top tech names including Google, Microsoft, Qualcomm, Intel, Broadcom, ARM, and others have cut ties with the Chinese giant. If a reduction in its phone production is true, it will doubtlessly be a result of the US government's actions.
In the weeks following the ban, sales of Huawei flagship fell by around one-fifth in France. Eslewhere, more UK consumers are trading in the company’s handsets, and the country’s mobile carrier, EE, dropped Huawei phones from its 5G network launch.
Analysts believe that if China retaliates to the escalating trade war by banning Apple products and manufacturing from within its borders, the US company’s profits will fall by almost 30 percent.
In what’s likely to be a response to the tension between the two countries, China has just warned Chinese-funded bodies in the US that they could face harassment from US law enforcement agencies. Additionally, the tourism ministry warned Chinese tourists to be aware of potential threats such as robbery and gun violence when visiting America, while the education ministry said an increase in visa denials and delays means Chinese students should consider the risks when looking to study in the US.