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Huawei eyes deals worth $30bn

Huawei Technologies, the Chinese telecommunications equipment maker, is confident of increasing its share of fixed line and mobile infrastructure deals in 2009, even though sector revenue is expected to shrink.

Xu Wenwei, Huawei’s chief marketing officer, told the Financial Times that the company was targeting deals worth $30bn this year, having secured contracts worth $23bn in 2008. His comments suggest that Huawei is confident of growing at the expense of some of its rivals, which include Ericsson, Alcatel-Lucent and Nokia Siemens Networks.

Alcatel-Lucent and Nokia Siemens Networks are predicting that the telecoms equipment market will decline this year in revenue terms because fixed line and mobile operators will cut their capital spending in the economic downturn.

However, Mr Xu said: “We remain quite confident of continued and robust growth this year.” Huawei, which is not a public company, has not published its 2008 accounts. Mr Xu estimated Huawei generated sales of $17.7bn last year, which would represent a 41 per cent increase on 2007.

Huawei’s 2008 sales will differ from the $23bn of contracts it signed because revenue from some of the deals will not be recorded in its accounts for last year.

Huawei’s global market share of deals to supply mobile infrastructure in-creased from 7.2 per cent in 2007 to 15.5 per cent last year, making the company the third largest supplier after Ericsson and Nokia Siemens Networks, according to analysts at Société Générale.

Asked if Huawei could increase its market share of fixed line and mobile infrastructure deals, Mr Xu said: “We will continue to grow sustainably and steadily.”

Huawei’s bullish statement about 2009 is partly rooted in its success at winning large contracts to supply infrastructure for China’s mobile operators based on third generation wireless technology.

Huawei will be one of the main suppliers for China Mobile, China Unicom and China Telecom, according to BDA, an advisory and research group.

While Huawei has developed strong sales relationships with European mobile operators such as Vodafone and Telefónica, it has made limited progress in the US.

Last month Huawei failed to secure contracts with Verizon Wireless, the leading US mobile operator that selected suppliers for infrastructure based on fourth generation wireless technology.

Privately, some of Huawei’s rivals question the company’s strategy for breaking into new markets. One rival, who paid tribute to Huawei’s expansion in the sector, expressed concern that the company may be able to offer cheap deals by receiving subsidies from the Chinese government. Huawei last year denied getting subsidies.

Источник: Financial Times

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