Huawei is reportedly building its own chip factory in the UK
Huawei is the world’s second largest smartphone manufacturer, but the company has essentially been blocked from selling smartphones in the U.S. The U.S. smartphone market continues to be an Apple-Samsung duopoly, and Huawei is currently under a concentrated stream of pressure applied by the U.S. with many allegations being thrown around. The company, however, hasn’t backed down in the face of this pressure. It continues to pose a serious challenge to Samsung in the premium smartphone market by having vertical integration, with the Huawei Mate 20 Pro being a prime example here. The Huawei P30 and Huawei P30 Pro have also been announced today. In addition to this, Huawei has reportedly paid £37.5 million for the 550-acre former Spicers site at Sawston in Cambridge, UK.
The company has announced the construction of a chip factory in Cambridge, UK, which has an area of 500 acres, according to Chinese publication Evolife. Huawei is, at the same time, establishing a supporting chip R&D center. According to the publication, the new chip factory will be mainly used in the design and manufacture of optical communication modules. Huawei is trying to open up the UK and European markets by increasing investment. The company may be trying to get rid of the model of outsourcing manufacturing chips to TSMC, in order to become an independent chip manufacturer. This would be a major development, if true.
Huawei’s chip factory is located just next to Arm. The company acquired the land from US biotechnology company NWBio for a lease period of 20 years. 100 acres of this property will be used to build a new park. As part of the transaction, NWBio entered into lease back agreement for 87,000 sq feet of space at £500,000 per annum for 20 years, according to Business Weekly.
EvoLife notes that Huawei has already won several 5G big orders in Europe, and British carriers O2, British Telecom and Vodafone have already started testing Huawei 5G equipment. Three UK recently signed a £2 billion network architecture contract with Huawei. Up until now, Huawei has invested more than $2.3 billion in the UK, and plans to invest another $3.96 billion within five years.
Huawei will support BT and its subsidiaries in 16 major cities in the UK in 2019, according to the report. Vodafone 5G will be commercialized this year, and Huawei will also release 5G phones in time for these developments.
According to Business Weekly, the deal was signed last year, and it was the largest Cambridge industrial deal of 2018. Bidwells refused to name the buyer, but Business Weekly‘s sources confirmed to the publication that Huawei was indeed the purchaser, and the company is said to have “major plans” for the site.
Business Weekly notes that the company is crucial to the delivery of 5G to the UK. Arm CEO Simon Segars publicly backed Huawei and its technology last month. According to the publication, Huawei will initially build an R&D facility at the former Spicers site which benefits from approximately 100 acres of brownfield land. Cambridge property specialist Bidwells acted for U.S. biotechnology firm Northwest Biotherapeutics (NWBio) in the off-market deal.