Trump Threatens 100% Chip Tariff Unless U.S. Companies Build Locally

Recent Development in U.S. Trade Policy

Three months after the Trump administration granted a temporary exemption to most electronic goods from its toughest tariff measures, a new announcement has emerged that signals a potential shift in future trade strategies. The move could alter the cost structure for manufacturers and influence the competitive landscape for imported electronics.

• Exemption Details: The exemption formerly covered a broad spectrum of consumer electronics, easing import duties that had been among the highest imposed in recent years.
• Timing of the Announcement: The latest statement was issued after a period marked by global economic uncertainty and evolving supply‑chain dynamics.
• Potential Impact: Firms that rely on imported components may see reduced overhead, while domestic producers could face increased pressure to compete on price and innovation.

As the administration weighs the long‑term implications of these tariff adjustments, stakeholders across the technology sector remain attentive to how policy changes will affect market access and trade flow.

US Tech Leaders Respond Amid Trump’s New Chip Tariff Threat

Trump’s 100% tariff will apply to all computer chips unless firms commit to manufacturing in the United States. The announcement follows a brief period during which most electronics were temporarily exempted from the president’s toughest tariffs.

Apple’s Dual‑Phase Investment Plan

• On Wednesday, Apple CEO Tim Cook pledged an additional $100 billion for domestic chip production.
• This commitment builds on Apple’s prior February investment, raising the company’s total U.S. manufacturing spend to $600 billion.
• Cook’s announcement came shortly after the Trump administration’s tariff exemption statement.

Broader Big Tech Commitments

• Companies like TSMC and Nvidia have also announced significant U.S. investment in the semiconductor sector.
• Collectively, Big Tech has pledged around $1.5 trillion for U.S. chip development since Trump’s return to office in January.
• These moves echo efforts to counter the potential price hike from the new tariff.

Market Reactions

• Apple shares climbed 5% during regular Wednesday trading and surged an additional 2% in after‑hours session.
• Nvidia’s stock dipped slightly in extended trading, amid a $1 trillion gain in market value since the start of Trump’s administration.

Industry Context

• Global demand for computer chips grew by 19.6% in the year ending in June, according to the World Semiconductor Trade Statistics.
• Trump’s tariff strategy marks a shift from the bipartisan CHIPS and Science Act, which allocated over $5 billion for chip plants, research, and workforce training under President Biden.
• While the former act offered subsidies, tax credits and other incentives to attract private investment, Trump’s approach relies on trade pressure to spur domestic production.

As the U.S. government seeks to bolster its semiconductor industry, the tension remains whether the Apple‑Trump partnership will adequately shield iPhones manufactured in China and India from the looming tariff, and mitigate price increases for new releases scheduled next month.