In a move that’s likely only going to worsen the trade war between the U.S. and China, Chinese companies are boycotting Apple after Huawei’s CFO was arrested in Canada on orders of a US law enforcement agency earlier this month. Chinese companies are offering their employees subsidies for buying Huawei smartphones and boycotting Apple products.

The subsidy ranges from anywhere between 10 to 20 percent, with some companies even compensating the full price of the device. More than 20 Chinese companies which include the likes of Shanghai Youluoke Electronic and Technology and Fuchun Technology took to Weibo and other social media platforms in China to announce this move. They also announced that they will be buying other products from Huawei as well for their businesses. Overall, Huawei has gained support from more than 200 Chinese businesses.

The show of support has been broad, from information technology providers to food companies. A regional government official said that several hundred businesses were conducting such programs nationwide.

Fuchun Technology announced that it will be given each of its 200 employees anywhere between 100 to 500 yuan as compensation for buying a Huawei smartphone before the end of 2018. A machinery company in Shenzhen is taking an even more drastic step. It has threatened to confiscate Apple devices from its employees and fire them if they don’t adhere to the rules. On a similar note, Shenzhen Yidaheng Technology has announced that it would fine its employees the equivalent price of the Apple device they purchase. Other companies have threatened to hold back the bonuses of their employees for purchasing Apple products.

Huawei has also received support from the Communist Party and the Communist Youth League which are encouraging Chinese businesses to subsidize the purchase of Huawei products for their employees.

Conclusion

It has already been a very rough ride for Apple in China. Apple is always under intense scrutiny in the China including new suit to ban iPhone XS and iPhone XR and to make matters worse. It recently lost a patent battle against Qualcomm in a Chinese court. The court ruled that Apple infringed on two of Qualcomm patents and ended up banning the sales of iPhone 6s through iPhone X. Despite harsh business conditions, China is an important market for Apple which is why it was rapidly expanding its retail presence in the country up until 2017.

As for this boycott from Chinese companies, Apple is obviously not at fault here. However, the whole thing has been given a political spin which is working in favor of Huawei and against Apple.

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