The US government's pressure on Huawei takes its toll
The Chinese telecommunications giant laid off several staffers in DC and New Jersey as it scales back its ambitions here.
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The Huawei P20 and P20 Pro are the newest smartphones from the Chinese vendor -- and they won't be coming to the US.
Huawei, the Chinese telecommunications giant perennially in the crosshairs of the US government, is shaking up the team responsible for its relationships here.
The company let go of several American staffers in DC, according to a person familiar with the situation. Among them is William Plummer, a nearly eight-year Huawei veteran who was the man most responsible for establishing the company's bona fides with policy makers in DC. The New York Times earlier reported that Huawei let go of five Americans from its DC policy office.
Huawei also laid off staff in New Jersey responsible for maintaining relationships with carriers AT&T and Verizon, which have scrapped their plans to sell the company's phones, according to another person familiar with the situation. It's clear why they would have been cut -- given the time it takes to roll out a product with a carrier, Huawei likely wouldn't have had anything ready until 2020 -- if the government was willing to play ball.
"Like every company, we continually evaluate our organization and align our resources to support our business strategy and objectives," said a Huawei spokeswoman. "Any changes to staffing size or structure are simply a reflection of standard business optimization.
The layoffs come amid mounting pressure from the US over the last several months, which reportedly convinced AT&T and Verizon to drop out of plans to sell its phones. Best Buy likewise dropped Huawei products. The company is the world's third-largest smartphone maker by volume, but it has struggled to make a dent in the US, partly because of concerns expressed by the government, including the FBI, CIA NSA, the Federal Communications Commission and House Intelligence Committee.
The action also comes amid mounting pressure on Chinese telecommunications companies and a broader escalation of tariffs from both the US and China. On Monday, the Commerce Department imposed a "denial of export privileges" against ZTE, which translates to a ban on US companies selling any products and services to the China-based company.
Huawei has denied any allegations that its products are unsafe.
The company will continue to reach out to the US government, and DC still includes at least one Chinese staffer, according to the person.