Huawei wants suppliers in its related supply chain to test and package chips – the final step in semiconductor component production – in China, by the end of this year at the earliest.

Huawei is accelerating the localization process of the semiconductor segment after President Trump’s ban.

In addition, the company is also gradually bringing more domestic manufacturers into its supply chain.

Semiconductor chip production is mostly done in regions such as Europe, Japan, Taiwan or Korea.

However, Huawei’s efforts are facing many challenges because of the economic instability caused by Covid-19, as well as the increasingly tight grip of President Donald Trump’s administration.

`Many suppliers want to stay in a safe place instead of choosing a bold option. That is understandable, especially when current and future demand is not high due to the epidemic,` a director in the supply chain

The director of another company in the supply chain also had a similar opinion.

A third source also commented that supply chains will not choose to bring their factories to China: `The supply chain is very complex and intertwined, like a giant onion. Huawei can peel it.`

In addition, other sources in the semiconductor industry also said that the impact of the Trump administration is an indisputable issue.

Huawei began efforts to localize its supply chain in 2018 after ZTE was embargoed by the US.

Besides localization, the company also mobilizes hundreds of engineers from factories and promotes research to reduce dependence on foreign businesses.

Huawei’s semiconductor localization will face challenges overseas.

Chiu Shih-fang, a supply chain analyst at the Taiwan Institute of Economic Research, said that Huawei’s ambitions are quite clear, as the company wants to `control and ensure` the chip supply to avoid external influence.