Huawei picks France for first European factory

Chinese technology firm Huawei has chosen France for its first production facility in Europe. The company said the project will cost at least €200m, and will make 4G and 5G network equipment worth €1bn a year.

To counter concerns over cyber security, Huawei will open the centre to "carriers, governments and related authorities, demonstrating Huawei’s positive stance on Europe’s call for digital sovereignty".

Its wireless base stations and software will also be on display.

The company said the construction process would use "some of the world’s most advanced production equipment and tools from local leading partners", and that the plant itself would be "highly automated and intelligent".

The company stressed the benefits it could bring Europe in countering a US campaign to persuade governments not to use its products, on grounds that it would allow the Chinese government to spy on 5G data networks. China has called it a ploy to give US firms an advantage in the race to 5G.

A European factory is intended to make European governments more comfortable with selecting Huawei’s gear, and to further its drive to be a global company, rather than a Chinese one.

Stéphane Téral, director of telecommunications research at IHS Markit, told the South China Morning Post that another motivation was to boost capacity. "At this stage of the mobile industry, it is critical for Huawei to have a radio communications factory somewhere in Europe to relieve the pressure on the existing ones in China," he said.

Most of the products produced in the new plant will be sold in Europe, Huawei’s second-largest market after China.

The company has secured 91 commercial 5G contracts around the world, of which 47 are from European telecoms operators, including Spain’s Telefonica, Sunrise of Switzerland and the Dutch company KPN.

The company said it had chosen France because of its highly educated labour pool and its "ideal positioning". It did not give any possible locations for the plant.

Image: Huawei is the world’s largest telecoms equipment maker (Dreamstime)

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