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Huawei now selling more consumer devices than telco equipment

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(Image: CNET)

Huawei has released its annual results for 2018, with the Chinese giant reporting a 25 percent increase in net profit to 59 billion yuan ($8.7 billion) on revenue of 721 billion yuan, a 20 percent increase from last year.

Broken down by division, the company’s consumer business is now contributing the most in sales, growing 45 percent during the year to 349 billion yuan, while the sale of equipment to telcos was down 1.3 percent to 294 billion yuan. Huawei enterprise services contributed 10 percent of the company’s revenue in 2018, posting 74 billion yuan, an increase of 24 percent year-on-year.

By region, China made up 52 percent of sales, contributing 372 billion yuan, an increase of 20 percent on 2017; the fastest growing region was EMEA, which saw a 24 percent jump in sales to 204 billion yuan; not far behind was the Americas, however it represents the company’s smallest sales region, growing only 21 percent to 48 billion yuan; while the remainder of the Asia Pacific excluding China saw sales increase 15 percent to 82 billion yuan.

Huawei said it allocated 14 percent of its revenue to research and development and boasted about the 5,400 patent applications to the World Intellectual Property Organization during the year, making it globally the company with the most filings. As of December 2018, Huawei had 87,800 patents granted to it, with 11,150 of those patents being registered in the US.

The company has long claimed that it had an advantage in its 5G technology thanks to being able to integrate 5G base station with microwave.

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(Image: Huawei)

“Through heavy, consistent investment in 5G innovation, alongside large-scale commercial deployment, Huawei is committed to building the world’s best network connections, rotating chair Guo Ping said in the annual report. “Throughout this process, Huawei will continue to strictly comply with all relevant standards to build secure, trustworthy, and high-quality products.”

Yet during 2018, Huawei found itself on the wrong side of decisions by the US, Australia, and New Zealand to ban or limit the extent that Huawei carrier equipment could be used.

On Thursday, Huawei suffered a security-related setback when the board overseeing the use of its equipment in the United Kingdom said there were new risks in using Huawei equipment.

“Overall, the Oversight Board can only provide limited assurance that all risks to UK national security from Huawei’s involvement in the UK’s critical networks can be sufficiently mitigated long-term,” the board said.

It also added that no progress had been made on the faults reported last year.

In Huawei’s annual report, Guo reiterated that security and user privacy were the “absolute top” of the company’s agenda.

Earlier this month, the Chinese giant announced that it was suing the United States government to overturn a ban on federal government entities in the country doing business with it.

Also: Huawei ban sees TPG end rollout of Australian mobile network 

“The US government has long branded Huawei a threat. It has hacked our servers and stolen our emails and source code,” Guo Ping said at the time. “Despite this, the US government has never provided any evidence supporting their accusations that Huawei poses a cybersecurity threat.

“Still, the US government is sparing no effort to smear the company and mislead the public about Huawei. Even worse, the US government is trying to block us from the 5G markets in other countries.”

The company is currently facing a 10-count indictment alleging the company conspired to steal intellectual property from T-Mobile and subsequently obstructed justice, in addition to separate 13-count indictment against the company and its CFO Meng Wanzhou.

“The company denies that it or its subsidiary or affiliate have committed any of the asserted violations of US law set forth in each of the indictments, is not aware of any wrongdoing by Ms Meng, and believes the US courts will ultimately reach the same conclusion,” Huawei said in January.

The US Department of Justice is alleging that Huawei offered bonuses to employees for stealing information, before clarifying to its US employees that such behaviour would be illegal.

Explaining Australia’s ban on Huawei, former Australian Prime Minister Malcolm Turnbull said the ban instituted in August was not done at the behest of another nation or for protectionist reasons, but because it defended Australia’s sovereignty and as a “hedge against changing times”.

“It is important to remember that a threat is the combination of capability and intent,” Turnbull said earlier this month.

“Capability can take years, decades to develop. And in many cases won’t be attainable at all. But intent can change in a heartbeat.”

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Toyota lowers production goals by 15 percent for November

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The global chip shortage is impacting automakers significantly. This week, Toyota announced that it plans to cut its global production output by 15 percent in November. The reduced production is laid directly at the feet of the shortage of microprocessors needed to build modern vehicles.

Despite chopping production in November, Toyota says it is still sticking to its planned production goals for the entirety of 2021. The company has said that it plans to ramp up production in December. Toyota is the largest automaker in Japan and also builds some of its vehicles in the US.

Toyota was also forced to reduce production in September and October due to the chip shortage and other issues caused by the coronavirus pandemic. For the year through March 31, Toyota reduced its production goals to 9 million vehicles representing a reduction of 300,000 units. In addition, the pandemic has significantly impacted components required to build its vehicles sourced from Malaysia and Vietnam.

Toyota says that a decline in COVID-19 infection rates in southeast Asia will allow chip manufacturers to increase output for the remainder of the year. Toyota wasn’t as impacted as some automakers by the chip shortage and pandemic because it had a stockpile of components allowing it to continue manufacturing operations.

The automaker has asked its component suppliers in southeast Asia to boost its allotment of chips and other components in December to allow it to ramp production significantly and meet its goals. Toyota spokesperson has stated that the total loss production for the automaker between September and November will be as high as 910,000 vehicles. In North America specifically, the reduced production in November will mean between 45,000 and 55,000 fewer vehicles produced.

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Porsche deliveries climb significantly despite chip shortage

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The global chip shortage impacts most automakers and has resulted in reduced shipments and production stoppages. While most automakers are seeing their deliveries decline, Porsche has seen deliveries increased by 13 percent in the first three quarters between January and September 2021. Porsche says it has delivered 217,198 vehicles around the globe.

The automaker notes that demand for its vehicles rose across all sales regions, but increased demand was particularly strong in the US. While deliveries have increased for Porsche, the automaker still says the coronavirus situation is dynamic, and it is facing challenges in procuring semiconductors. The most popular model for Porsche is the Cayenne, with deliveries of 62,451 units.

Porsche’s second most popular model was the Macan delivering 61,944 units, working out to a 12 percent increase in deliveries for that model. Its third most popular model may be a surprise to some. The electric Taycan sports car delivered 28,640 units to customers. 2021 is only the second year that model has been available, and it’s already surpassed deliveries of the iconic 911. So far, the 911 has delivered 27,972 units in the first three quarters of the year, which represents a 10 percent increase.

Porsche says the 718 Boxster and the 718 Cayman delivered 15,916 units. The four-door Porsche Panamera remains popular, delivering 20,275 units. In the US, Porsche says it delivered 51,615 vehicles in the first nine months of 2021. Those numbers represent a 30 percent increase compared to deliveries made during 2020. Across the entirety of the American continent, Porsche delivered 63,025 vehicles for a 29 percent increase compared to last year.

Interestingly, the largest single market for Porsche is China, with 69,789 vehicles delivered, representing an 11 percent gain compared to 2020. In addition, Porsche delivered 56,332 vehicles across Europe.

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AAA study finds vehicle safety systems are negatively impacted by rain

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Researchers from AAA have published a new study looking at how moderate to heavy rain affects the ability of modern vehicle safety systems to function. AAA conducted testing in a closed course environment simulating rainfall and discovered that test vehicles equipped with automatic emergency braking they were traveling at 35 mph collided with stopped vehicles 33 percent of the time during rain. Other vehicle safety features were also impacted during rain.

Other tested features include lane keeping assist, which allowed the vehicle to depart their lane 69 percent of the time during grade. AAA says that vehicle safety systems called advanced driver assistance systems are typically tested in ideal conditions. AAA believes testing standards need to be changed to incorporate real-world conditions that drivers would typically encounter.

Safety systems rely on cameras and sensors to visualize markings on the road, cars, pedestrians, and other obstacles. AAA’s Greg Brannon says people don’t always drive around in perfect sunny weather and test methods need to be changed to take real-world conditions into account. AAA says its research found rain had the biggest effect on vehicle safety systems.

However, they also stimulated other environmental conditions, including bug impacts and dirt. The results found that driving in simulated moderate to heavy rain impacted both safety systems. Automatic emergency braking engaged while approaching a stopped vehicle in the lane ahead at 25 mph but resulted in collision 17 percent of the time.

When speeds were increased to 35 mph, collisions occurred 33 percent of the time. Overall, during testing, lane keeping assist veered outside of lane markers 69 percent of the time. Researchers said that when testing systems with a simulated dirty window stamped with a concentration of bugs, dirt, and water, only minor differences in performance were noted. However, cameras can be influenced by a dirty windshield, and AAA says it’s important that drivers keep the windshield clean.

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