Trump slaps 100% tariffs on chips to get tech onshore

US president Donald Trump has introduced 100% tariffs on semiconductors imported into the US, until corporations make substantial commitments to construct out US-based manufacturing.

In a recording of a briefing posted by Bloomberg TV on YouTube, Trump mentioned: “We’re going to be placing a really massive tariff on chips and semiconductors, however the excellent news for corporations like Apple is that if you’re constructing in the US or have dedicated to construct in the US, there can be no cost.” He added that the tariff of 100% could be imposed on chips until corporations “construct within the US”. 

Trump’s announcement follows on from information from Apple earlier within the week that it has dedicated $100bn of latest funding within the US, which accelerates its plans to make $600bn of US funding over the following 4 years. Apple introduced the American Manufacturing Program (AMP) to maneuver extra of Apple’s provide chain and superior manufacturing to the US. It mentioned this can enhance funding throughout the US and incentivises world corporations to fabricate extra essential parts there.

“In the present day, we’re proud to extend our investments throughout the US to $600bn over 4 years and launch our new American Manufacturing Program,” mentioned Tim Prepare dinner, Apple’s CEO. “This consists of new and expanded work with 10 corporations throughout America. They produce parts which can be utilized in Apple merchandise offered all around the world, and we’re grateful to the president for his help.”

In April 2025, the Division of Commerce Bureau of Business and Safety within the US started a public session as a part of Part 232 – Nationwide Safety Investigation of Imports of Semiconductors and Semiconductor Manufacturing Tools. The investigation goals to find out the consequences on nationwide safety of imports of semiconductors, semiconductor manufacturing tools and their by-product merchandise. This consists of, amongst different issues, semiconductor substrates and naked wafers, legacy chips, modern chips, microelectronics and SME parts.

Whereas the outcomes of this investigation has not been printed, there seems to be a rising concern within the US administration that it not has a dominant place within the semiconductor market.

Because of the dominance of Intel, the US was thought of a frontrunner in semiconductors, however Intel has but to discover a profitable response to the AI acceleration dominance of Nvidia. Within the ready remarks for the corporate’s second quarter of 2025 outcomes, Lip-Bu Tan, who took over from Pat Gelsinger as the corporate’s CEO in March 2025, mentioned: “Whereas we do have to construct and consolidate upon our silicon franchise, based mostly upon our x86 CPUs and our Xe GPUs, we recognise the necessity to transfer up the abstraction stack into system and software program.

“That is an space the place Intel has historically been weak or fully absent, however we intend to incubate and develop these vital ability units and capabilities beneath my management. This may take time, however it will likely be important for Intel to remain related within the subsequent wave of computing.”

Whereas each Intel and Nvidia are US-listed corporations, Nvidia doesn’t manufacture its personal chips – its main provider is TSMC. Rival US processor maker, AMD, which does supply AI acceleration know-how because of its graphics processor models (GPUs) that compete with Nvidia, can be a fabless producer, which suggests its chips are primarily manufactured by Taiwanese foundry TSMC. There are studies that Intel is considering exiting chip fabrication, which would depart the US semiconductor sector extra weak.

It’s believed that each TSMC and Samsung have prevented tariffs. Reuters has reported that the Samsung chips provided to Apple will come from a manufacturing facility in Texas, whereas TSMC has been growing a producing and analysis and improvement web site in Arizona since 2020. In April 2025, it started work on the third fab, which is predicted to ship quantity manufacturing by the top of the last decade. Nvidia’s Blackwell chips are additionally being produced at TSMC chip plant in Arizona.

Dutch producer ASML, which produces the photolithography tools that permits chips to be fabricated, is getting ready for the influence of US tariffs. When questioned concerning the tariffs in the course of the firm’s second quarter of 2025 earnings name, CEO Christophe Fouquet mentioned: “First off, clearly, once we ship new programs to our clients within the US, there may very well be tariffs on that. The second is that if we ship elements for manufacturing within the US. The third part is that if we ship elements for service within the area operations within the US.”

There’s additionally a fourth chance, if tariffs are imposed on semiconductor imports from the US, with Fouquet saying: “We’re attempting to mitigate the impact for your entire ecosystem. We’re working with the availability chain and with our clients to no less than be sure that the influence for ASML is as restricted as potential.”