US officials have approved licence applications worth hundreds of millions of dollars for China's blacklisted telecom company Huawei to buy chips for its growing auto component business.
Huawei, the world's largest telecommunications equipment maker, has been hobbled by trade restrictions imposed by the Trump administration on the sale of chips and other components used in its network gear and smartphones businesses.
US has been reinforcing the hard line on exports to Huawei, denying licences to sell chips to Huawei for use in or with 5G devices.
Auto chips are generally not considered sophisticated, lowering the bar for approval. One person close to the licence approvals said the government is granting licences for chips in vehicles that may have other components with 5G capability.
Citing threats to US national security and foreign policy interests, the US has gone to great lengths to slow the growth of Huawei's key communications-related business.
After placing Huawei on a US Commerce Department trade blacklist in 2019, which banned sales of US goods and technology to the company without special licences, the US last year ratcheted up restrictions to limit the sale of chips made abroad with US equipment.
It also campaigned to get allies to exclude Huawei from their 5G networks over spying concerns. Huawei has denied the allegations.
Huawei reported its biggest ever revenue drop in the first half of 2021, after the US restrictions drove it to sell a chunk of its once-dominant handset business and before new growth areas have fully matured.
Underscoring the shift into smart cars, the company's rotating chairman Eric Xu announced pacts with 3 state-owned Chinese carmakers, including BAIC Group, to supply "Huawei Inside", a smart vehicle operating system, at the Shanghai Auto Show earlier this year.
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