The filings point to unease across a range of industries about the economic fallout from targeting chips. — Bloomberg
BLOWBACK to President Donald Trump’s idea of tariffs on imported semiconductors is proving to be broad and deep, stretching from automotive companies and boat makers to the technology industry and crypto enthusiasts, according to a review of more than 150 public comments on the proposal.
The possible levy of up to 25% has united rivals like Tesla Inc, General Motors Co and Ford Motor Co in voicing reservations.
It’s brought together industry lobbies from the Crypto Council for Innovation to the National Marine Manufacturers Association.
Even Taiwan and the People’s Republic of China are finding common cause, along with predictable parts of the technology sector including chipmakers and wireless providers.
The reason is that chips are now in almost everything: refrigerators and microwaves, tyre pressure sensors and navigation systems, electronic bidets and sonar equipment and, of course, smartphones and computers.
Additionally, tariffs threaten to snarl supply lines and jack up costs for consumers.
“There’s a large mismatch between the amount of chips we use in this country in various products and the supply created here in the United States,” JoAnne Feeney, a partner and portfolio manager at Advisors Capital Management, said in an interview.
“Putting a tax on those imports will simply raise the cost, and that’s not a good thing for consumers.”
Case in point is the marine association, which warns the impact would be felt by more than 1,300 manufacturers who face higher expenses for essentials like propulsion technology, engines and GPS or global positioning system, systems.
“These systems are not optional luxuries – they are fundamental to safety, function and performance,” the association said.
“Many components have no United States equivalent or are only available from highly concentrated suppliers overseas.”
The boating sector’s concerns were among comments from 154 stakeholders submitted to a Commerce Department review of whether to slap tariffs on chips as part of Trump’s campaign to redraw global supply lines and boost domestic manufacturing.
Predictable technology sources weighed in, including chipmakers Taiwan Semiconductor Manufacturing Co (TSMC) and Intel Corp.
But feedback also landed from a wide spectrum of sectors, along with trading partners like Japan and Brazil.
The companies, trade groups and individuals who commented on the chips investigation largely signalled support for the president’s vision of deepening the US manufacturing base and expanding the American workforce.
Yet most expressed concern over the potential consequences and urged making any levies that emerge as targeted as possible.
Taken together, the filings point to unease across a range of industries about the economic fallout from targeting chips.
Trump has so far brushed off many of those concerns and cited plans by a range of companies to invest in the United States, including Taiwan-based TSMC’s decision to boost its commitment to building plants near Phoenix.
White House spokesman Kush Desai said Trump remains committed to reshoring manufacturing critical to US national security.
“While the Commerce Department completes its Section 232 investigation, the administration is expanding domestic critical mineral production, slashing regulations, and pushing pro-growth policies,” Desai said in a statement.
The Commerce Department didn’t respond to a request for comment. — Bloomberg
Michael Shepard writes for Bloomberg. The views expressed here are the writer’s own.
