US president Donald Trump has announced 100% tariffs on semiconductors imported into the US, unless firms make substantial commitments to build out US-based manufacturing.
In a recording of a briefing posted by Bloomberg TV on YouTube, Trump said: “We’re going to be putting a very large tariff on chips and semiconductors, but the good news for companies like Apple is that if you are building in the United States or have committed to build in the United States, there will be no charge.” He added that the tariff of 100% would be imposed on chips unless companies “build in the US”.
Trump’s announcement follows on from news from Apple earlier in the week that it has committed $100bn of new investment in the US, which accelerates its plans to make $600bn of US investment over the next four years. Apple announced the American Manufacturing Program (AMP) to move more of Apple’s supply chain and advanced manufacturing to the US. It said this will increase investment across the US and incentivises global companies to manufacture more critical components there.
“Today, we’re proud to increase our investments across the US to $600bn over four years and launch our new American Manufacturing Program,” said Tim Cook, Apple’s CEO. “This includes new and expanded work with 10 companies across America. They produce components that are used in Apple products sold all over the world, and we’re grateful to the president for his support.”
In April 2025, the Department of Commerce Bureau of Industry and Security in the US began a public consultation as part of Section 232 – National Security Investigation of Imports of Semiconductors and Semiconductor Manufacturing Equipment. The investigation aims to determine the effects on national security of imports of semiconductors, semiconductor manufacturing equipment and their derivative products. This includes, among other things, semiconductor substrates and bare wafers, legacy chips, leading-edge chips, microelectronics and SME components.
While the results of this investigation has not been published, there appears to be a growing concern in the US administration that it no longer has a dominant position in the semiconductor market.
Thanks to the dominance of Intel, the US used to be considered a leader in semiconductors, but Intel has yet to find a successful response to the AI acceleration dominance of Nvidia. In the prepared remarks for the company’s second quarter of 2025 results, Lip-Bu Tan, who took over from Pat Gelsinger as the company’s CEO in March 2025, said: “While we do need to build and consolidate upon our silicon franchise, based upon our x86 CPUs and our Xe GPUs, we recognise the need to move up the abstraction stack into system and software.
“This is an area where Intel has traditionally been weak or entirely absent, but we intend to incubate and grow these important skill sets and capabilities under my leadership. This will take time, but it will be vital for Intel to stay relevant in the next wave of computing.”
While both Intel and Nvidia are US-listed firms, Nvidia does not manufacture its own chips – its primary supplier is TSMC. Rival US processor maker, AMD, which does offer AI acceleration technology thanks to its graphics processor units (GPUs) that compete with Nvidia, is also a fabless manufacturer, which means its chips are mainly manufactured by Taiwanese foundry TSMC. There are reports that Intel is thinking about exiting chip fabrication, which would leave the US semiconductor sector more vulnerable.
It is believed that both TSMC and Samsung have avoided tariffs. Reuters has reported that the Samsung chips supplied to Apple will come from a factory in Texas, while TSMC has been developing a manufacturing and research and development site in Arizona since 2020. In April 2025, it began work on the third fab, which is expected to deliver volume production by the end of the decade. Nvidia’s Blackwell chips are also being produced at TSMC chip plant in Arizona.
Dutch manufacturer ASML, which produces the photolithography equipment that enables chips to be fabricated, is preparing for the impact of US tariffs. When questioned about the tariffs during the company’s second quarter of 2025 earnings call, CEO Christophe Fouquet said: “First off, obviously, when we send new systems to our customers in the US, there could be tariffs on that. The second is if we send parts for manufacturing in the US. The third component is if we send parts for service in the field operations in the US.”
There is also a fourth possibility, if tariffs are imposed on semiconductor imports from the US, with Fouquet saying: “We’re trying to mitigate the effect for the entire ecosystem. We are working with the supply chain and with our customers to at least make sure that the impact for ASML is as limited as possible.”
