Intel and TSMC allegedly took a significant step to potentially evade Trump's tariffs. Here's the gist of the situation.
Informal Article:
Trump's Tariffs Rock the Tech World
On April 2, President Trump exposed his game-changing tariffs for countries he accuses of fleecing the US for years. The 10% tariff is currently in effect, but heavier duties, like a 46% whack on Vietnam and a 26% smack on Japan, won't land until April 9.
Two days post the revelation of a popular gaming company's upcoming Switch 2, Nintendo announced a delay in the pre-orders for the new console due to Trump's tariffs.
Taiwan Semiconductor Manufacturing Co. (TSMC), a tech giant providing chips to Apple, Nvidia, Qualcomm, AMD, is giving Intel's chip-making factories in the US a run for their money—but not in the way you might think.
According to a bombshell report from The Information, TSMC and Intel are set to team up for a mind-blowing venture. The Taiwanese chip maker is rumored to acquire a 20% stake in Intel, learn its manufacturing methods, and train Intel employees.
TSMC's Tariff Gamble
This partnership with Intel has been in the works for quite a while. Back in February, TSMC was eying Intel's manufacturing plants, with Broadcom another contender in the race. Insiders even speculated that Intel, once a mighty chip-making powerhouse, was headed for the rocks.
But don't count Intel out yet. They've got 15 plants across the US, which are undergoing expansion thanks to the grants from the Chips Act of 2022. They're receiving up to $7.9 billion in funding to construct their factories in Ohio, Arizona, and other locations.
During his speech to Congress on March 4, Trump took a swipe at the 2022 CHIPS and Science Act—signed by former Prez Joe Biden—that aimed to boost domestic semiconductor manufacturing. Trump wasn't very pleased, calling the act "horseshit."
Trump did give TSMC a pat on the back for its US investments in his speech, as well as in various conversations since then. The chip maker also announced a staggering $100 billion investment in US semiconductor manufacturing in March, adding to its existing commitment of $65 billion. Reportedly, this Arizona plant is cranking out Apple's next-gen A16 processor.
Trump hasn't imposed tariffs on semiconductors yet. But during a recent chat with White House reporters aboard Air Force One, he hinted that the chip tariffs were about to drop any minute.
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- The upcoming partnership between TSMC and Intel is set to revolutionize the storage technology sector, with the Taiwanese chip maker considering acquiring a 20% stake in Intel and learning their manufacturing methods.
- With the upcoming tariffs on laptop components, businesses might need to reconsider their purchasing decisions for devices like laptops with SSD storage and ample RAM.
- Trump's tariffs have already started affecting the tech industry, as was seen with Nintendo's delay in pre-orders for their new console, the Switch 2.
- In light of these developments, industry analysts and financial experts are closely monitoring the tariff situation and its potential impact on businesses, especially those dependent on technology products.
- The gaming industry might feel the heat with the looming tariffs on semiconductors, with potential delays in launching new consoles or gaming processors.
- The latest investment by TSMC in US semiconductor manufacturing indicates a shift in the tech landscape, as the company invests a staggering $100 billion in its Arizona plant, which is reportedly manufacturing Apple's next-gen A16 processor.
- With the ongoing tensions and potential tariffs in the tech industry, technology enthusiasts could benefit from subscribing to our free newsletter, The Snapshot, to receive exclusive insider updates on these developments.
