(Yicai Global) Feb. 19 -- Huawei Technologies has refused to comment on a media report that claimed that the Chinese tech giant has informed its suppliers of a major reduction in parts demand this year after selling its budget brand Honor.

Huawei refrained from commenting on the Nikkei's report to the Securities Times yesterday.

The firm has notified its suppliers that it plans to order components for 70 million to 80 million smartphones this year, a 60 percent decline from last year as the US sanctions continue to bite, the Nikkei reported yesterday, citing multiple suppliers.

Huawei was included in the US Entity List in May 2019, prohibiting American businesses from selling technologies and products to the Chinese company. Thus, the firm's chip purchases dropped by almost 24 percent in 2020 from 2019.

Besides supply, the ban has affected demand. In November 2020, Huawei sold Honor to a joint venture between a company under the Shenzhen government and over 30 dealers and agents for a reported CNY100 billion (USD15.4 billion), leaving a gap in the ex-parent's consumer business.

Huawei's founder Ren Zhengfei has voiced his confidence in the remaining handset brand. "We will never sell the smartphone business,” the chief executive said at an event on Feb. 9. "I am more rather than less confident about keeping Huawei alive after more than one year since the US sanctions came into effect because we have more approaches to overcome difficulties.”

The Shenzhen-based company is diversifying its product portfolio. "Huawei is likely to have breakthroughs in coal, steel, music, smart displays, personal computers, and tablet computers," Ren added. "We can survive even if not relying on smartphones."

Editor: Emmi Laine, Xiao Yi