U.S. President Trump proposes a harsh tariff of 100% on semiconductors produced outside of the U.S., aiming to bolster domestic manufacturing through increased trade taxes.
In a bid to alleviate potential iPhone tariff pressure, Apple's CEO, Tim Cook, announced an investment of $100 billion in the U.S. to buy components from American suppliers. Every new iPhone and iWatch will now contain glass made in Kentucky by Corning, an American company.
The semiconductor sector, crucial for the functioning of various devices, has largely outsourced its production to Asian countries like South Korea and Taiwan. However, the complexity of the semiconductor supply chain makes it challenging to move production to the U.S. This issue has been addressed by President Trump, who has threatened a 100% tariff on all semiconductors not produced in U.S. factories.
To encourage semiconductor makers to increase U.S. production, Trump has granted an exemption to companies investing in U.S. production capacity. Major semiconductor companies that have already announced plans to build manufacturing facilities in the U.S. would likely qualify for this exemption.
President Trump aims to boost domestic manufacturing to achieve job creation and economic stimulation. To this end, he has suspended new tariffs for 90 days and stated that there will be no charges for companies building in the U.S. This move is expected to encourage more companies to shift their production of semiconductors to the U.S.
Currently, many chips are manufactured in South Korea and Taiwan, then sent to other countries, like Malaysia, for testing. Companies building factories in the U.S. to shift their production of semiconductors will be exempt from tariffs.
The field of artificial intelligence (AI) relies entirely on semiconductors. As more companies invest in U.S. production, the potential for advancements in AI and other tech sectors could increase significantly.
Apple has also signed ten new deals with American companies as part of this investment. The company's commitment to American manufacturing could set a precedent for other tech giants to follow suit.
Sources: 1. Trump's chip tariff exemption encourages US production 2. Apple to Invest $100 Billion in U.S. to Buy Components From American Suppliers 3. Semiconductor Industry Association Seeks Clarity on Trump's Tariff Exemption
- The semiconductor industry, crucial for the advancement of technology sectors like artificial intelligence, may witness significant growth due to the influx of American investments following the Tariff exemption announced by President Trump.
- In alignment with President Trump's policy-and-legislation for boosting domestic manufacturing, tech giant Apple has made a $100 billion commitment to buy components from American suppliers, aiming to set a precedent for other tech companies.
- In the realm of finance and business, major semiconductor companies investing in U.S. production capacity may benefit from lower tariffs, as per the recent exemption announced by President Trump, a move expected to stimulate domestic manufacturing growth.
