Qualcomm, Intel and Micron outlined the downside of proposed US tariffs on advanced chips and manufacturing equipment imports, warning higher input costs could slow efforts to boost domestic production.
The three companies filed separate submissions to the US Department of Commerce, which on 1 April initiated an investigation under section 232 calling for industry comment on the effect of imports on national security.
Qualcomm argued imposing tariffs on chips in the short term without providing sufficient time, support and opportunity for construction and the start of operations, stemming from investments announced since the start of the second Trump administration, would harm US chip design companies without creating proportional economic benefit to the US or its workers.
It added it also “must continue to rely on foreign fabs” for a large portion of its production, including those in Taiwan and South Korea.
Pointing to the highly complex semiconductor supply chain, Qualcomm stated: “Loss of technological leadership may be further compounded if foreign countries were to respond to increased tariffs by working together to eliminate US content from their products.”
Intel warned tariffs on critical inputs such as raw materials and specialised equipment will raise production costs, making it increasingly difficult for domestic manufacturers to compete globally.
In addition, it stated foreign countries are implementing protective measures which could exclude US manufacturers from key markets.
The chipmaker, highlighting its increased R&D investment in 2024 to develop advanced chips domestically, noted government policies “should support, not hinder” its investments, adding imposing overly broad tariffs could disrupt progress.
Micron cautioned tariffs that increase costs on key inputs, particularly semiconductor manufacturing equipment, will significantly raise the cost of building semiconductor fabs in the US, making domestic fabs less competitive or possibly not commercially viable.
It recommended the government consider temporary tariff exemptions on critical inputs for semiconductor fabs, including manufacturing equipment, construction materials, replacement parts and raw materials.
Taiwan Semiconductor Manufacturing Co (TSMC) also issued a similar warning, stating new import restrictions could create uncertainties for many committed semiconductor projects in the US, including its $165 billion Arizona investment plan.