Leica joins forces with Xiaomi for new smartphone after partnership with Huawei ends

The new strategic cooperation will see Leica and Xiaomi jointly develop an “imaging flagship smartphone”, slated to be launched in July
The break-up with Leica has dealt another blow to Huawei’s dwindling smartphone business, which had thrived at home and abroad

Xiaomi

Iris Dengin Shenzhen

Published: 10:00pm, 23 May 2022

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German camera maker Leica is teaming up with Chinese smartphone maker Xiaomi after ending a seven-year partnership with Huawei Technologies Co, whose handset business has been hamstrung by US sanctions.

The new strategic cooperation will see Leica and Xiaomi jointly develop an “imaging flagship smartphone”, slated to be launched in July, according to an announcement on Monday.

“This cooperation will provide a strong boost to Xiaomi’s imaging strategy,” said Lei Jun, Xiaomi’s founder, chairman and chief executive.

German camera maker Leica and Chinese gadget maker Xiaomi have announced a strategic partnership, with plans to release a new smartphone in July. Photo: Handout

Huawei’s partnership with Leica, which started in 2015 and resulted in their first phone a year later, ended on March 31, the Shenzhen-based tech giant said on Monday, in response to an inquiry by the South China Morning Post.

“The two companies highly appreciate the partnership,” a Huawei representative said via email. “Huawei is grateful to its global consumers for their support and will continue to provide them with the ultimate mobile photography experiences through its continued pursuit of innovation.”

The break-up with Leica has dealt another blow to Huawei’s dwindling smartphone business, which had thrived at home and abroad thanks partly to the German brand’s high-end image and leading camera technologies.

Huawei’s once lucrative smartphone business has been suffering since the US put the Chinese company on its trade blacklist on national security grounds, barring it from accessing components that use core American technologies.

Huawei, which briefly overtook Apple and Samsung Electronics in global smartphone sales in 2020, saw revenue in its consumer business slump by nearly half in 2021, a far cry from the 3.3 per cent growth registered in 2020 and 34 per cent increase in 2019.

A man uses his mobile phone in Beijing on April 27, 2022. Photo: Simon Song

While other Chinese smartphone makers including Xiaomi, Oppo and Vivo have rushed to fill the void left by the fall of Huawei, a slowing economy, chip shortage and supply chain disruptions in China have posed challenges for domestic players.

The country’s strict Covid-19 lockdowns have dampened consumer demand for new smartphones, contributing to weak sales so far this year. In the first quarter, Xiaomi shipped 38.5 million smartphones globally, down 10.5 per cent from a year earlier. Smartphone revenue came in at 45.8 billion yuan (US$6.88 million), down 11 per cent.

During the period, total shipments from the top five smartphone vendors in the mainland – Apple, Xiaomi, Oppo, Vivo and Honor – dropped 18 per cent year on year to 75.6 million units, according to research firm Canalys.

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