U.S. authorities urge Apple not to buy Chinese memory

U.S. Commerce Secretary Howard Lutnick said in an interview that U.S. President Trump’s administration does not want Apple to buy memory chips from Chinese manufacturers. But he believes Apple will do it anyway wall street journal.

Huge demand for RAM from data center operators has led to a global shortage of these chips and a sharp rise in prices for remaining inventory. Apple and other manufacturers were forced to significantly increase prices for finished products; Apple even turned to Chinese manufacturers to mitigate the impact of shortages. “The Trump administration is not happy with this”“,” Lutnick said in an interview after visiting Apple’s manufacturing plant in Houston. There must be “Other solutions to the memory problem, but great American companies won’t use Chinese solutions”he noted, adding that he had brought the position to the attention of Apple management.

The iPhone maker is testing memory chips from Chinese companies Changxin Memory and Yangtze Memory, people familiar with the matter said, suggesting that Apple may use the chips in devices it intends to use in China. HP and Acer have begun installing CXMT memory in computers sold outside the United States. U.S. regulations require U.S. companies to obtain a license to disseminate information about Changxin Storage and Yangtze Storage products. This scenario is conceivable only if Chinese manufacturers produce chips exclusively for Apple – where it would be possible to negotiate prices and purchase finished products without permission from the authorities.

Apple Chief Operating Officer Sabih Khan declined to confirm in an interview that Apple is testing Chinese storage chips, but said that considering the scale of the shortage, “Consider all options”including working with existing suppliers to increase U.S. production. The company can change every component of the iPhone, but when it comes to memory “Changes are unlikely”that is, the use of Chinese parts is not excluded.

There has been some tension between the Trump administration and Apple, despite attempts by both sides to declare unity. As the largest device maker in the United States, Apple can play a huge role in actually bringing production back to the United States. She has already taken the first steps in that direction to achieve Trump’s tariff reductions. But more money is still being invested in foreign supply chains. Micron has called on the White House not to allow Apple to use Chinese chips because it would harm domestic production and would be detrimental to Trump’s plan to return production to the United States. Micron has a large investment program in the United States, giving it leverage in negotiations with authorities.

The memory chip shortage affects not only Apple but other companies in everything from medical device makers to the automotive industry. But this crisis cannot be solved by political will: it will take at least a year to build the necessary capabilities. Much of Apple’s supply chain is in Asia, and the company is working with contract manufacturers to build new factories in India to assemble iPhones. Apple has pledged to spend tens of billions of dollars to produce iPhone chips in the United States and build a new Mac mini assembly line in Texas. The company is also working to help chipmakers rebuild their supply chains.