Apple seeks approval to source chips from blacklisted Chinese firm
What's the story
Apple is lobbying the Trump administration for permission to buy memory chips from ChangXin Memory Technologies (CXMT), a Chinese company currently on the Pentagon's blacklist, according to Financial Times. The move comes as part of Apple's strategy to ease financial pressure caused by rising chip prices, a problem that has been affecting many US tech companies.
Strategic move
Apple pushes for approval to source chips from CXMT
Apple has been lobbying the White House for approval to source memory chips from CXMT. The iPhone maker approached the Commerce Department over a month ago and has also spoken to other administration officials and allies in Washington. This comes as part of Apple's broader strategy to deal with rising memory chip prices amid national security restrictions on Chinese chipmakers.
Blacklist implications
CXMT's status as a Chinese military company complicates deal
CXMT, China's leading memory chipmaker, was designated a Chinese military company by the Defense Department during the Biden administration. The company was added to the Commerce Department's Entity List last year after being approved by an interagency committee. US companies are prohibited from exporting goods, software, and technology to entities on this list without a license, which is likely to be denied, further complicating Apple's proposed deal with CXMT.
Price adjustments
Rising chip prices force Apple to increase product costs
The ongoing rise in memory and storage chip prices has already affected Apple's product pricing. The company recently increased the prices of its iPads and MacBooks, citing that it could no longer absorb the rising costs. This move highlights how global market trends and trade policies can directly impact consumer technology prices in the US.