President Donald Trump declared on Wednesday his administration´s intent to impose a 100% tariff on imported computer chips and semiconductors unless manufacturers shift their production to the United States. Speaking from the Oval Office alongside Apple CEO Tim Cook, Trump explained the proposed tariff is aimed at incentivizing companies to build more chips domestically, exempting those who do so from the import tax. The announcement signals a significant escalation in the administration´s industrial policy, with the potential to drive up consumer prices on a wide range of products—including electronics, automobiles, and household appliances—that rely on semiconductors.
This sweeping tariff move follows a period of temporary exemptions for many electronics and represents a direct effort to reverse the globalized chip supply chain in favor of domestic production. Trump emphasized that US-based production would sidestep the tariff, underscoring the pandemic-driven semiconductor shortages that had previously contributed to higher inflation and rising vehicle prices in America. Major technology firms, including Apple, Nvidia, and Intel, have made substantial commitments to expand chipmaking facilities in the US, with collective investments estimated in the trillions of dollars since the beginning of Trump´s second term. Apple alone has increased its pledge by billions, aiming to strengthen domestic supply chains ahead of its forthcoming product launches.
Financial markets responded favorably to the announcement, with Apple shares jumping 5% in regular trading and another 3% after hours. Nvidia, known for its role in Artificial Intelligence chip development, saw its stock edge higher, extending the company´s impressive gains during Trump´s current administration. Intel, a long-standing industry leader, also experienced an uptick in its share price. Despite these market movements, prominent chipmakers and the Semiconductor Industry Association declined to comment directly on the new policy. The direction marks a marked shift away from the previous administration´s CHIPS and Science Act approach, which allocated billions in incentives for domestic manufacturing rather than relying on tariffs. With global chip demand surging nearly 20% year over year, Trump´s plan sets the stage for heightened industry competition and ongoing debate over how best to secure the nation’s technological supply lines.
