Best Buy cuts ties with China's Huawei: source

[March 22, 2018]  By Nandita Bose and Sijia Jiang

LAS VEGAS/HONG KONG (Reuters) - Best Buy Co Inc, the largest U.S. consumer electronics retailer, will cut ties with China's Huawei Technologies Co Ltd, a person familiar with the matter said, amid heightened scrutiny on Chinese tech firms in the United States.

Best Buy will stop selling Huawei's devices over the next few weeks, according to the person with knowledge of the matter, a setback for the Chinese telecommunications giant as it looks to expand in the U.S. market.

The move, after similar actions from U.S. carriers including AT&T Inc, comes as U.S. scrutiny of Chinese tech firms grows amid simmering tensions over U.S.-China trade and concerns of security.

A Best Buy spokesman told Reuters the firm could not comment on specific contracts with vendors. "We make decisions to change what we sell for a variety of reasons," he said.

Huawei said in emailed comments on Thursday that it valued its relationship with Best Buy but could not discuss details of its partnership with the U.S. firm.

"Huawei currently sells its products through a range of leading consumer electronics retailers in the U.S.," the firm said, adding its products met the "highest security, privacy and engineering standards in the industry".

Earlier this year, AT&T was forced to scrap a plan to offer Huawei handsets after some members of Congress lobbied against the idea with federal regulators, sources told Reuters. Verizon Communications Inc also ended its plans to sell Huawei phones last year, according to media reports.

A Best Buy store is seen in Los Angeles, California, U.S., March 13, 2017. REUTERS/Lucy Nicholson/File Photo

Last month two Republican Senators introduced legislation that would block the U.S. government from buying or leasing telecommunications equipment from Huawei or Chinese peer ZTE Corp, citing concern the firms would use their access to spy on U.S. officials.

The tougher climate in the United States has forced Huawei to sell its flagship smartphone Mate 10 Pro - its challenger to the iPhone - in the United States only through open channels.

U.S tech and electronics website CNET.com first reported the termination of the agreement on Wednesday.

(Reporting by Nandita Bose in LAS VEGAS and Sijia Jiang in HONG KONG; additional reporting by Abinaya Vijayaraghavan in Bengaluru; Writing by Adam Jourdan; Editing by Sunil Nair & Shri Navaratnam)

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