Huawei, the Chinese enterprise reportedly said that it is planning to lay off hundreds of employees in the U.S. Its plan to layoff comes after its struggles with a blacklist by the Trump administration. The layoffs are expected in the Huawei US-based research subsidiary Futerwei Technologies including in Washington, Texas, and California state.
This U.S. unit employs approximately 850 people. According to the people close to the matter, the Chinese workers were asked if they want to return back to the country and stay with the company. Following the backlist, Futerwei employees were imposed with restriction to talk with their colleagues based in Huawei’s home offices in China.
The decision to restrict the communication comes after the Commerce Department added Huawei into their so-called entity list. Earlier, President Trump announced Huawei as a national security threat as they were alleged for spying on American consumers. While Huawei denied all the allegations.
After the blacklist Mr. Ren Zhengfei, Huawei founder said that the actions by America will cost them $30 Billion this year and next. The Number 2 smartphone maker sales slipped by 40% in the month. As Google has discontinued any software updates on Android operated Huawei phones, it is willingly working on to replace with its own operating system named Hongmeng.
According to the WSJ, people have been notified of their dismissal while additional layoffs are planned soon. Huawei is the largest telecommunication equipment maker and almost generates $11 Billion for the U.S. chip makers such as Qualcomm, Intel, etc. For now, Huawei is on retrieval period until August 2019 following which Huawei can’t import any American products or use for the new products. But after meeting with President XiPing, he has eased up the relaxation.
Trump said that the U.S. tech giant companies can do business with Huawei or export products that don’t pose a national security threat. Last year, the Chinese enterprise ZTE was slumped with a far-reaching deal for violating the trade deal agreement.