Huawei’s founder Ren Zhengfei indicated that the company will be spending more on production equipment this year to maintain supply continuity as it deals with a “live-or-die moment” with the United States.
The letter from Ren comes shortly after the U.S. extended the deadline by 90 days for companies working with Huawei to find alternative business options.
U.S. Commerce Secretary Wilbur Ross said “we’re giving them a little more time to wean themselves off.” U.S. President Donald Trump initiated the ban in May and granted temporary licences to companies to work with Huawei that would have expired on August 19th.
Ren wrote in a memo for staff to work aggressively towards sales targets because the company is going into “battle mode” to survive.
“The company is facing a live-or-die moment,” he wrote in the memo, which Reuters reported on.
“If you cannot do the job, then make way for our tank to roll; And if you want to come on the battlefield, you can tie a rope around the ‘tank’ to pull it along, everyone needs this sort of determination!”
But even though the company has been facing troubles with the U.S., the Huawei indicated that it grew its smartphone sales by 24 percent year-over-year in the first half of 2019.
“In the first half, our results looked good, it is likely because our Chinese clients were sympathetic and made payments in time, the big volume made cash flow look good, this doesn’t represent the real situation,” Ren wrote in the memo.
Ren’s memo indicated that the company likely needs to reform its operations globally and will be “granting more power to the frontline, cutting out reporting layers and eliminating inefficient posts,” Reuters reported.
“In 3-5 years time, Huawei will be flowing with new blood,” Ren wrote. “After we survive the most critical moment in history, a new army would be born. To do what? Dominate the world.”