President Donald Trump has promised tariffs on chips that America imports and promised that the tariffs would go substantially higher over the course of a year. Trump shared fresh details about his tariff plans at a press briefing in Mar-a-Lago and added that he wanted America's partners time to come to the US and manufacture their products. Trump's remarks are the latest in a set of hard-hitting statements that have shaken the semiconductor industry and made firms backorder their products ahead of time in anticipation of potential tariffs.
Trump Promises To Allow Firms To Come To The US And Manufacture Products Before Implementing Tariffs
At his press briefing, the President was initially asked about tariffs against the car industry. When pressed further about his plans for semiconductors and pharmaceuticals, Trump replied that the tariffs will "be 25% and higher." He added that the tariffs will "go very substantially higher over a course of a year."
However, the President promised that his administration would give the chip companies time to locate to the US. Trump outlined that "we wanna give them time to come in," adding that when the companies "come into the United States and they have their plant or factory here, there is no tariff."
The President concluded by sharing that his administration wants to give the chip companies "a little bit of a chance" before implementing tariffs that might very well upend the global semiconductor industry.
His press conference outlined executive orders related to in-vitro fertilization, a transparency memorandum and an executive order for independent agencies.
Just as Trump shared his latest chip tariff plans, a group of Taiwanese sever companies outlined their plans to shift production to the US. As per the Economic Daily, seven major Taiwanese AI server makers recently visited Texas to evaluate whether to invest in the US. The report adds that some of these firms, which includes Pegatron, Wistron, Quanta Computer, Wiwynn and Inventec, can announce their US investment plans before May 10th.
Taiwanese firms estimate that the cost of acquiring land and building factories is roughly $2 billion, while adding automated equipment can increase the cost to range between $3 billion to $5 billion. Most Taiwanese sever companies have operations in Mexico and are worried about excessive costs in case of tariffs against the country.
While Foxconn and Pegatron refused to comment about their Texas visit, Quanta outlined that it aims to grow production in the US, while Wiwynn did not rule out expanding its US presence.
Reports of Taiwanese server firms moving production to the US are among a set of reports that have also claimed that the Trump administration is pressing Taiwan's TSMC to either outright buy Intel's foundries or consider other options. Market sources also believe that TSMC might take a stake in Intel's foundries in partnership with Qualcomm and Broadcom.
Market sources also report that Intel is accelerating its partnership with Taiwan's United Microelectronics Corporation (UMC) through which the latter can use some of Intel's idle capacity to avoid Trump's tariffs on chips imported by America. UMC manufactures chips on mature nodes, and its partnership with Intel is expected to cover 12-nanometer and higher nodes.
About the author: Ramish is a seasoned technology writer and editor with more than a decade of experience. He specializes in semiconductor fabrication and market analysis. With a background in finance and supply chain management - via his bachelors in Finance and a micromasters in supply chain management from MIT - Ramish combines financial rigor with deep industry insight to deliver accurate and authoritative coverage.
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