Apple, Micron clash before Trump over Chinese chip suppliers
What's the story
Apple is facing resistance from Micron, the only sizable US maker of memory chips, in its bid to use memory chips from Chinese suppliers. The Wall Street Journal reports that Micron is lobbying the Trump administration to reject Apple's proposal. The conflict has emerged after Tim Cook's recent interview with The Journal where he suggested that the US reconsider its decision to restrict access to certain Chinese suppliers.
Supplier discussions
Apple seeks to source memory chips from Chinese companies
Following Cook's remarks, The Wall Street Journal reported that Apple had already sought approval from the administration to source chips from China's ChangXin Memory Technologies (CXMT).
Along with this, the Financial Times reported that Apple was also in talks to buy chips from Yangtze Memory Technologies (YMTC).
Notably, both CXMT and YMTC have been labeled as Chinese military companies by the Pentagon.
Industry pushback
Micron's resistance to Apple's plans
The Wall Street Journal also reported that as Apple continues to lobby the Trump administration for approval of Chinese memory chips in products sold outside the US, it has faced resistance from Micron.
The latter is pushing officials to block this plan.
Micron executives, including CEO Sanjay Mehrotra, have warned that allowing CXMT and other Chinese companies to sell to US tech companies could decimate the domestic industry like China did with US steel and manufacturing plants.
Market impact
Micron offers to ease memory chip shortage
Micron has also said that it can help ease the current memory chip shortage by speeding up construction of domestic plants and increasing US investment.
A few weeks ago, a Micron executive claimed Apple's aggressive purchasing strategies contributed to the current shortage.
He said "a couple of [its] customers" had been "very aggressive with pricing" during the 2023 market downturn, which discouraged investment in additional production capacity.
Policy dilemma
Implications for Trump administration
The clash between Apple and Micron has put the Trump administration in a difficult position.
The lobbying fight could force Trump to choose between two of his top economic priorities: cutting prices for US consumers and increasing domestic semiconductor production to reduce dependence on other countries.
A White House spokesperson said that the administration would pursue "investments and economic relief for the American people while safeguarding our national security."