Chinese tech firms Huawei and ZTE are under intense scrutiny from the U.S. government out of fear their devices will enable spying from the Chinese government, leaving many Americans skeptical of Chinese brands. In response, companies like Huawei, Xiaomi and Oppo are buckling down on Europe.
“The political situation between Chinese companies and the U.S. government has benefited European consumers,” Ben Stanton, senior analyst at research firm Canalys, noted in a recent report earlier this month. “The U.S. administration is causing Chinese companies to invest in Europe over the U.S.”
Chinese companies like Xiaomi, Oppo, OnePlus and Huawei have expanded aggressively in Europe in recent years. Analysts say competitive prices and innovative features in the devices are increasingly appealing to European consumers, while Europe as a region has fewer barriers to entry than the U.S.
“The U.S. market is always attractive but the U.S. market also very different from others,” Wang said. “The carrier plays a very important role there. You need to do a lot of customization.”
The European strategy is paying off. Canalys found Xiaomi’s European phone shipments surged 62 percent last year, while Huawei’s increased 56 percent. Shipments from Apple and Samsung both declined in that same period.
Chinese companies have quickly gained market share by offering innovative, high-quality devices at a lower cost than their rivals. Bo Pi is chief technology officer at Goodix, a Chinese company that provides fingerprint sensor technology to smartphone makers including Huawei.
“The Chinese smartphone makers are much more aggressive,” he told CNBC Monday at Mobile World Congress. “They’re trying a whole new kind of format, a new technology.”