Apple's Chip Predicament: Lobbying US for Blacklisted Chinese Supplier
Apple's Chip Predicament: Lobbying US for Blacklisted Chinese Supplier
Apple is reportedly lobbying the US government to secure memory chips from blacklisted Chinese firm CXMT. This move highlights the tech giant's struggle with soaring chip costs and US national security restrictions.
Apple is reportedly engaging in significant lobbying efforts with the Trump administration to obtain clearance for purchasing memory chips from ChangXin Memory Technologies (CXMT), a Chinese company that the Pentagon has placed on a blacklist. This strategic push comes as the iPhone maker grapples with escalating memory chip prices, which have already impacted the cost of its products.
The Financial Times, citing unnamed sources, reported that Apple has approached the White House to alleviate the financial strain caused by these rising costs. Neither the White House, Apple, nor CXMT have publicly commented on these reports. This situation underscores a growing dilemma for major U.S. technology firms, caught between the demands of their supply chains and Washington's national security directives concerning Chinese chip manufacturers.
Apple's outreach to the Commerce Department began over a month ago, with further engagement with other administration officials and allies in Washington. CXMT, a leading Chinese memory chipmaker, was designated as a Chinese military company by the Defense Department under the Biden administration. Subsequently, it was approved last year for addition to the Commerce Department’s Entity List by an interagency committee.
Inclusion on the Entity List means that U.S. companies are largely barred from shipping goods, software, and technology to CXMT without a special license, which is typically difficult to obtain and likely to be denied. The soaring costs of memory and storage chips, partly driven by the AI industry's data center expansion, have already led Apple to increase prices for its iPads and MacBooks, indicating the pressure it faces to manage component expenses.
