Dahua $550 Million West China Gov Project

By: John Honovich, Published on Mar 08, 2017

How does Dahua continue to invest in global expansion despite its many mistakes? 

Where can they get the money and strength to overcome the exposure of their backdoor?

Dahua is doing huge business inside of China with the Chinese government.

Dahua has recently announced a government partnership with a total projected value of $550 million USD. Inside this note, we examine the partnership and its potential for Dahua.

West ***** *******

*** ******* ** *** *******, *** ******* **** city ** ***** *** part ** ******** ********, ** autonomous ****** ** ***** with * ******* ** conflict / ******** **** the ***** ****** **********, ****** ******** a **** ********.

*********

* ***** ******** ******, though, ********** *** ***** spend / ********** ********. Though***** ********* **** ** its *********, *** ****** ***** that ** **** *********** ambiguity ** ***** ** how **** ***** **** be ***** *** **** this **** **** ******** come ********. 

Safe **** ******** ******

***** **** **** **** projects *** ******** ******. For *******, ****** * few ****** ************ ******* * ***** hundred ******* ****** ******* with *** **** ** Xi'an**** **** ***** **** create **,***+ ****. **** of *****'* **** ***** cities ********* **** ******* large ***** ******* ************** projects ****** ** *** government *** ** *********** with **** ************* **** Dahua, ********* ** ******.

Impact ****** *********

*** ******* ** ******* to ****** ***** **** of ********** ******** ** ******** to ******* *** ****** expansion ** **** ***** and *********. **** *******'* financials ****** **** **** profits **** ***** ******** operations, **** ** ***** government ********, ***** ******* them *** ***** ** sustain ****** / ********** overseas.

** ***** *** ******** to ****** **** ********, it **** ******* **** the ******** *** ********* overseas ********** *** ******* for ********** ** **** expansion. ** *** ********, if ** **** ***** slows ** ***** ***** its******* ****** ****, **** ***** ********* these ********* **** ** home *** ********.

Comments (11)

I didn't go to business school, not did I sleep in a Holiday Inn last night.

 

If China is invested into Hik, why would they use any cameras other than Hik?

 

 

If China is invested into Hik, why would they use any cameras other than Hik?

Because provinces have latitude to make their own decisions. And corruption / bribes in China are widespread. And Dahua is big in its own right (~$2 billion USD annual revenue) meaning they have political power of their own inside China.

I do not understand how this can continue.  This project, beyond being ridiculous in scale is just the tip of the iceberg as there are many large non-security projects beyond this.  All of it appears to be paid for with debt.  At some point they will emerge from this age of cheap labor into an age where there is a middle class demanding more wage, fair working conditions, reduced pollution (or negative health effects), etc.   There are already explosive housing prices in the city, which sounds a lot like the US in 2007.

I believe that not only are Hikvision and Dahua focusing outside of China for growth but they are focusing outside China for survival when the bubble bursts. Right now they are buying hearts and minds of both the consumers, integrators, and OEMs with low cost product.

#1, debt is a critical factor in China keeping its growth rates up. And debt is growing significantly faster than growth which is unsustainable.

they are focusing outside China for survival when the bubble bursts

People who know the China market well have said that too. I don't think they would describe it exactly as 'survival' as much as 'diversification.' But the broader point is agreed that too much exposure to China debt / inefficient infrastructure spending is risky for them. 

Right now they are buying hearts and minds of both the consumers, integrators, and OEMs with low cost product.

I agree they are trying to buy hearts, minds and marketshare. I don't think they are being very successful at getting the 'hearts' of Western integrators and certainly not OEMs, who they are burning bridges with, even beyond the backdoor.

The main risk I see for the Chinese expansion is that their focus on winning buyers on low cost is dangerous since low cost buyers tend not to have brand / product loyalty, so it tends to be a bad investment.

Hey John,

Do you have any information if Dahua won a RFP or how Dahua was chosen?

or were them cherry-picked?

Do you have any information if Dahua won a RFP or how Dahua was chosen?

I don't but these things are typically negotiated in China. It's not like I want X,Y and Z, who has the lowest price?

It's also described as a partnership and usually such partnerships are not a single specific defined technical project but an overarching agreement.

Somewhere John Connor is staring off into the distance thinking "This is the day the Skynet Botnet started."

This is the day the Skynet Botnet started.

You are aware that in China they literally call their city surveillance systems Skynet? So technically it started a number of years ago.

Completely forgot about that.  There must not be a word for irony in China.

I can't help but seeing that as Chinese propaganda...look how good we are western world and how big our projects are etc. Also a nice way to distract the attention from the Chinese Government and Hik link...

I can't help but seeing that as Chinese propaganda

To the best I can tell this announcement was only directed internally to China, since I found it on a Chinese language portion of Dahua's Investors information disclosures. 

If they wanted to tout it internationally, they would have done it in English, got it distributed to press outlets, etc.

My gut feel is that Dahua and Hikvision prefer not to market these deals to the West. The reason being that they worry about the negative perception of "Oh look at these companies getting money from the Chinese government." For example, way back when Hikvision had negligible overseas branded sales in 2010 they announced an $800 million China city deal. Given how small they were then and lacked an international brand, it made sense. Since then, Hikvision has won many other cities but they never announce them (in English, to the West, etc.).

Read this IPVM report for free.

This article is part of IPVM's 6,535 reports, 880 tests and is only available to members. To get a one-time preview of our work, enter your work email to access the full article.

Already a member? Login here | Join now

Related Reports

China Dali Fever Cameras and Booming Sales Examined on Sep 11, 2020
Zhejiang Dali, one of China's original thermal technology developers, has...
Dahua Thermal Temperature Monitoring System Tested on May 11, 2020
Dahua's thermal temperature monitoring system has gained mass attention as a...
Axis Exports To China Police Criticized By Amnesty International on Sep 21, 2020
Axis Communications and other EU surveillance providers are under fire from...
Dahua Profits Surge Due To Fever Camera Sales on Aug 25, 2020
While Dahua's overall revenue is down, driven by challenges within China, the...
Honeywell Warns of Huawei, Advocates Futureproofing on Aug 31, 2020
For years, Honeywell has profited from OEMing Dahua and using Huawei...
Sunell is The First China Manufacturer to Market NDAA Compliance on Jul 30, 2020
Most China manufacturers are going to be impacted by the NDAA 'Blacklist...
Hikvision Put on US DoD "Communist Chinese Military Companies" List, Faces Risk of Presidential Sanctions on Jun 26, 2020
The US DoD has put Hikvision on a list of "Communist Chinese Military...
US Passes Uyghur Human Rights Law Condemning Mass Surveillance on Jun 18, 2020
The US government has passed the Uyghur Human Rights Policy Act of 2020,...
Openpath Raises $36 Million on Jul 16, 2020
Openpath has raised $36 million as 2020 has become a boom year for access...
China Surveillance Vulnerabilities Being Used To Attack China, Says China on Apr 07, 2020
While China video surveillance vulnerabilities have been much debated in the...
Dahua Faked Coronavirus Camera Marketing on Apr 01, 2020
Dahua has conducted a coronavirus camera global marketing campaign centered...
Google Invests in ADT, ADT Stock Soars on Aug 03, 2020
Google has announced a $450 million investment in the Florida-based security...
Uniview H1 2020 Financials Examined on Sep 08, 2020
While Dahua and Hikvision, helped by fever camera sales, are recovering from...
Drako's Companies (Brivo, Eagle Eye) Take $4+ Million in PPP Funds on Jul 14, 2020
While centimillionaire Dean Drako is the owner of two of the largest SaaS...
Netposa Stock Surges 46% After US Human Rights Abuse Sanctions on May 27, 2020
Last Friday, the US government announced it would sanction PRC video...

Recent Reports

OnTech Smart Services Partners With Google and Amazon To Compete With Integrators on Sep 25, 2020
A pain point for many homeowners to use consumer security and surveillance is...
The Future of Metalens For Video Surveillance Cameras - MIT / UMass / Immervision on Sep 25, 2020
Panoramic cameras using 'fisheye' lens have become commonplace in video...
Hikvision Sues Over Brazilian Airport Loss on Sep 24, 2020
Hikvision was excluded from a Brazilian airport project because it is owned...
China General Chamber of Commerce Calls Out US Politics on Sep 24, 2020
While US-China relations at an all-time low, optimism about relations...
Verkada Disruptive Embedded Live Help on Sep 24, 2020
Call up your integrator? Have someone come by the next day? Verkada is...
IP Networking Course Fall 2020 - Last Chance - Register Now on Sep 23, 2020
Today is the last chance to register for the only IP networking course...
Drain Wire For Access Control Reader Tutorial on Sep 23, 2020
An easy-to-miss cabling specification plays a key role in access control, yet...
Norway Council of Ethics Finds Hikvision Human Rights Abuses "Ongoing" on Sep 23, 2020
Hikvision's involvement in "serious human rights abuse" in Xinjiang is...
IPVM Camera Calculator User Manual / Guide on Sep 23, 2020
Learn how to use the IPVM Camera Calculator (updated for Version 3.1). The...
Installation Course Fall 2020 - Save $50 - Last Chance on Sep 22, 2020
This is a unique installation course in a market where little practical...
SimpliSafe Business Security Launched Examined on Sep 22, 2020
SimpliSafe has launched "SimpliSafe Business Security" that the company...
FLIR CEO: Many New Fever Entrants "Making Claims That The Science Just Won't Support" on Sep 22, 2020
FLIR's CEO joins a growing number calling out risks with fever / screening...
China Bems Temperature Measurement Terminal Tested on Sep 22, 2020
Guangzhou Bems (brand Benshi) is the manufacturer behind temperature...
Axis Exports To China Police Criticized By Amnesty International on Sep 21, 2020
Axis Communications and other EU surveillance providers are under fire from...
Milestone XProtect on AWS Tested on Sep 21, 2020
Milestone finally launched multiple cloud solutions in 2020, taking a...