Chip-making equipment suppliers could lose up to $1 billion a year due to Trump tariffs

The United States is home to a number of major suppliers of chip-making equipment, but the domestic semiconductor industry still relies heavily on imports. Some sources cited by Reuters estimate that Trump’s import tariffs will cost equipment market participants up to $1 billion a year.

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This issue was discussed in Washington last week for several days, as the news agency explains, so it is possible that when forming customs policy, the American authorities will listen to the opinions of experts. There are three large manufacturers of equipment for the production of chips in the United States: Applied Materials, Lam Research and KLA. Each of them will lose $350 million a year on new import duties, and the total amount of losses will easily exceed $1 billion. Smaller manufacturers such as Onto Innovation will face the need to bear additional costs of several tens of millions of dollars a year. Additional losses will mainly consist of reduced revenue from the sale of equipment, which will become more expensive, as well as the search for alternative suppliers of components for the equipment itself. In addition, equipment suppliers will have to pay higher costs for administering import duties and export restrictions imposed by the US authorities.

This is not the first example of the negative impact of US policy on the business of suppliers of equipment for chip production. Even under Biden, restrictions on the supply of such equipment to China were actively introduced, and American manufacturers lost revenue for this reason. They even expressed dissatisfaction with the fact that their foreign competitors were using this opportunity to strengthen their positions and start earning more on supplies to China. Now American equipment manufacturers will have to convince the government that the introduction of higher duties will complicate the localization of chip production in the United States and make it more expensive.