In an interview with Bloomberg Television, the billionaire founder of China\u2019s largest technology company conceded that Trump administration export curbs will cut into a two-year lead Huawei had painstakingly built over rivals like Ericsson AB and Nokia Oyj. But the company will either ramp up its own chip supply or find alternatives to keep its edge in smartphones and 5G.<\/p>\n
The US on May 17 blacklisted Huawei – which it accuses of aiding Beijing in espionage – and cut it off from the US software and components it needs to make its products. The ban hamstrings the world\u2019s largest provider of networking gear and No. 2 smartphone vendor, just as it was preparing to vault to the forefront of global technology.<\/p>\n
It\u2019s rocking chipmakers from America to Europe as the global supply chain comes under threat. The ban could also disrupt the rollout of 5G wireless globally, undermining a standard that\u2019s touted as the foundation of everything from autonomous cars to robot surgery.<\/p>\n
Ren maintained Huawei had the capability to devise its own solutions — given time. It\u2019s been designing its own chips for years, which it now uses in many of its own smartphones. It\u2019s even developing its own operating software to run phones and servers.<\/p>\n
The CEO however deflected questions about how quickly Huawei can ramp up those internal replacement endeavors. Failure could dent the fast-growing consumer business and even kill emergent efforts such as cloud servers.<\/p>\n
\u201cThat depends on how fast our repairmen are able to fix the plane,\u201d said Ren, who appeared at ease in a white jacket over a pink shirt, making light of questions about his company\u2019s plight. \u201cNo matter what materials they use, be it metal, cloth or paper, the aim is to keep the plane in the sky.\u201d<\/p>\n
Ren has gone from recluse to media maven in the span of months as he fights to save the $100 billion company he founded.<\/p>\n
The 74-year-old billionaire emerged from virtual seclusion after the arrest of eldest daughter and Chief Financial Officer Meng Wanzhou as part of a broader probe of Huawei. He\u2019s since become a central figure in a US-Chinese conflict that\u2019s potentially the most important episode to shape world affairs since the collapse of the Soviet Union.<\/p>\n
As Ren said in January, when the world\u2019s biggest economies battle for dominion, nothing in their way will survive. His company is a \u201c sesame seed\u201d between twin great powers, he said.<\/p>\n
\u201cThis may bring one of China\u2019s national champions to its knees,\u2019\u2019 said Chris Lane, an analyst at Sanford C. Bernstein & Co. \u201cIf China shut down all the Apple plants, the US would get very upset. This is a similar kind of move.\u201d<\/p>\n
Ren has had much to deal with of late. His company finds itself increasingly under fire, besieged by a US effort to get key allies to ban its equipment. The US assault helped crystallize fears about Huawei\u2019s growing clout in areas from wireless infrastructure and semiconductors to consumer gadgets.<\/p>\n
Then came the blacklist. Huawei appears to have anticipated this possibility since at least mid-2018, when similar sanctions threatened to sink rival ZTE Corp. Huawei\u2019s said to have stockpiled enough chips and other vital components to keep its business running at least three months.<\/p>\n
\u201cWe have made some really good chips,\u201d said Ren, a legendary figure in his home country thanks to the way he built Huawei from scratch into a global powerhouse. \u201cBeing able to grow in the toughest battle environment, that just reflects how great we are.\u201d<\/p>\n
Last week, Trump said Huawei could become part of a US-Chinese trade deal, stirring speculation it was a bargaining chip in sensitive negotiations. But Ren said he wasn\u2019t a politician. \u201cIt\u2019s a big joke,\u201d he scoffed. \u201cHow are we related to China-US trade?\u201d<\/p>\n
If Trump calls, \u201cI will ignore him, then to whom can he negotiate with? If he calls me, I may not answer. But he doesn\u2019t have my number.\u201d<\/p>\n
In fact, Ren pulled no punches in going after a man he labeled \u201ca great president\u201d just months prior. \u201cI see his tweets and think it\u2019s laughable because they\u2019re self-contradictory,\u201d he quipped. \u201cHow did he become a master of the art of the deal?\u201d<\/p>\n
Beijing itself isn\u2019t without options. Some speculate China might retaliate against the ban of Huawei – which may widen to include some of its most promising AI firms – by in turn barring America\u2019s largest corporations from its own markets. Apple Inc. could relinquish nearly a third of its profit if China banned its products, Goldman Sachs analysts estimate.<\/p>\n
Ren said he would object to any such move against his American rival.<\/p>\n
\u201cThat will not happen, first of all. And second of all, if that happens, I\u2019ll be the first to protest,\u201d Ren said in the interview. \u201cApple is my teacher, it\u2019s in the lead. As a student, why go against my teacher? Never.\u201d<\/p>\n
At the heart of Trump\u2019s campaign is suspicion that Huawei aids Beijing in espionage while spearheading China\u2019s ambitions to become a technology superpower. It\u2019s been accused for years of stealing intellectual property in lawsuits filed by American companies from Cisco Systems Inc. and Motorola Inc. to T-Mobile US Inc.<\/p>\n
Critics say such theft helped Huawei vault into the upper echelons of technology – but Ren laughed off that premise.<\/p>\n
\u201cI stole the American technologies from tomorrow. The US doesn\u2019t even have those technologies,\u201d he said. \u201cWe are ahead of the US If we were behind, there would be no need for Trump to strenuously attack us.\u201d<\/p>\n
Ren\u2019s easy demeanor belies the way he\u2019s consistently shunned attention. The army engineer-turned-entrepreneur has this year turned in a command performance in the public spotlight, particularly for someone who\u2019s rarely spoken to foreign media since he created Huawei.<\/p>\n
The re-emergence of the reclusive CEO – who before January last spoke with foreign media in 2015 – underscores the depth of the attacks on Huawei, the largest symbol of China\u2019s growing technological might.<\/p>\n
Ren again waved off speculation his company is in any way beholden to the Communist Party, though he\u2019s declared his loyalty ultimately lies with the country\u2019s ruling body.<\/p>\n
US lawmakers aren\u2019t convinced. That\u2019s why the US Commerce Department cut off the flow of American technology – from chips to software and everything in-between.<\/p>\n
An iconic figure in Chinese business circles, the billionaire remains a uniquely placed voice in a conflict that will help define the global landscape. Ren, who says he survived the chaos of the Cultural Revolution thanks in part to his much sought-after expertise in high-precision tools, remains a big believer that Huawei\u2019s technology will win the day.<\/p>\n
His company today generates more sales than internet giants Alibaba Group Holding Ltd. and Tencent Holdings Ltd. combined. In 2018, Huawei overtook Apple in smartphone sales, a triumph that burnished his tech credentials. His quotes adorn the walls of the food court at Huawei\u2019s sprawling campus on the outskirts of the southern metropolis of Shenzhen, and employees still speak of him in reverent tones.<\/p>\n
The company\u2019s 2018 report shows he has a 1.14% stake, giving him a net worth of $2 billion, according to the Bloomberg Billionaires Index.<\/p>\n
Ren, who survived Mao Zedong\u2019s great famine to found Huawei in 1987 with 21,000 yuan, said Huawei will do whatever it takes to survive. It will ignore the noise while doing its business the best it can. Meanwhile, the pressure is bound to take a toll. At one point during the interview, Ren\u2019s unflappable demeanor cracked – if only for a minute.<\/p>\n
\u201cThe US has never bought products from us,\u201d he said, bristling. \u201cEven if the US wants to buy our products in the future, I may not sell to them. There\u2019s no need for a negotiation.\u201d<\/p>\n
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