BUSINESS

United States weighs Apple bid for Chinese chips

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Washington, United States – Apple is lobbying the Trump administration for permission to buy memory chips from ChangXin Memory Technologies (CXMT), a Chinese firm that the U.S. Defense Department has designated a Chinese military company and that an interagency committee has approved for addition to the Commerce Department’s Entity List, the Financial Times reported. The iPhone maker has approached the Commerce Department and also engaged other administration officials and allies in Washington in an effort to secure clearance, according to unnamed sources cited by the newspaper. Placement on the Entity List would mean U.S. companies cannot ship goods, software or technology to CXMT without a license, which is likely to be denied, tightening restrictions on U.S. firms seeking to work with the Chinese chipmaker. Beijing, China – The lobbying push highlights the growing tension for major U.S. technology companies as soaring memory chip prices intersect with Washington’s national security measures targeting Chinese semiconductor manufacturers. CXMT is China’s leading memory chipmaker and one of several Chinese firms the Pentagon has blacklisted. Reuters reported that the White House, Apple and CXMT did not respond to requests for comment outside business hours. Apple recently raised prices on some iPad and MacBook models, saying it can no longer fully shield customers from surging memory and storage chip costs, which it links to rising demand from the artificial intelligence industry’s data center buildout.

Prepared by Christopher Adams and reviewed by editorial team.

Timeline of Events

Last year Interagency panel backs CXMT listing
More than a month ago Apple contacts Commerce Department officials
Last week Apple raises select iPad, MacBook prices
Thursday Apple cites surging memory, storage costs
Recently Pentagon designates CXMT Chinese military company
Recently CXMT proposed for Commerce Entity List
Recently Apple lobbying White House for chip waiver
Today Reuters reports on Financial Times disclosure

Why This Matters to You

If Apple can't buy chips from CXMT, your Apple devices might get pricier. The company already raised prices due to soaring chip costs. Check your budget if you're planning to buy an iPad or MacBook soon.

The Bottom Line

Apple is caught in a tug-of-war between business needs and national security. It's unclear if they'll get the green light to buy Chinese chips. Worth forwarding if you know someone eyeing a new Apple device.