Facing the risk of tax, Nvidia 'closes' super chip manufacturing project in the US, reducing dependence on Asia

Nvidia announced it would invest hundreds of billions of dollars in chip and electronics manufacturing in the US over the next four years, as the company adjusts its supply chain to reduce its reliance on Asia amid the threat of new tariffs imposed by US President Donald Trump.

Mr. Jensen Huang introduces Nvidia products at the Artificial Intelligence Developers Conference, March 18. (Source: AFP)

The massive investment by the world's most valuable chipmaker reflects a trend of major technology companies, including Apple, shifting their supply chains to accommodate President Trump's "America First" trade policy.

Supply chain shift strategy

“Over the next four years, we expect to buy about $500 billion worth of electronic components, and a significant portion of that will be manufactured in the United States,” Nvidia CEO and co-founder Jensen Huang told the Financial Times.

In an interview, Mr. Huang emphasized that Nvidia can now manufacture its most advanced systems in the United States through partners such as Taiwan Semiconductor Manufacturing Company (TSMC) and Foxconn.

He also commented that Huawei is becoming a formidable competitor in China.

At Nvidia's annual developer conference this week, he introduced a new generation of artificial intelligence (AI) chips called Vera Rubin, and announced plans to build massive data centers with millions of interconnected chips that require huge amounts of energy.

Ready to respond

Mr. Huang believes that the Trump administration could boost the development of the AI ​​industry in the US. “Having an administration that supports the industry and ensures that energy is not a barrier is great for AI in the US,” he said.

Earlier this month, TSMC announced a $100 billion investment in chip manufacturing facilities in Arizona, adding to the $65 billion investment it had already committed under the Joe Biden administration.

Nvidia's latest Blackwell systems are now manufactured in the US, Mr Huang said, adding: “TSMC's investment in the US enhances the resilience of our supply chain.”

Blackwell is Nvidia's next-generation GPU architecture, designed to optimize graphics performance, AI, ray tracing, and power efficiency. It will be the foundation for the GeForce RTX 5000 Series, accelerating gaming, content creation, and AI applications.

According to the Financial Times , in recent years, Nvidia and Apple have increasingly relied on TSMC's advanced chip manufacturing facilities in Taiwan (China).

But the relationship faces geopolitical risks, including the threat of US tariffs on chips produced in the territory, and frequent earthquakes that could disrupt production.

“The most important thing is to be prepared,” Mr. Huang stressed. “Right now, we can produce in the United States with a sufficiently diversified supply chain. If there is any disaster that affects production in Taiwan (China), it will be difficult, but we can still cope.”

Nvidia plans to spend about $500 billion on electronics manufacturing over the next four years. (Source: Reuters)

A formidable opponent

The US government is now tightening the export of Nvidia’s market-leading chips, which are used to train and run the most advanced AI models, while the industry is decrying a broader set of export controls under the Biden administration that are set to take effect in May.

Chinese companies also face barriers when buying advanced chipmaking equipment like ASML's photolithography machines.

While Nvidia still rakes in billions of dollars from the Chinese market, it faces stiff competition from Huawei, which has made significant strides with its Ascend AI chips.

“Huawei is the most powerful technology group in China,” Mr. Huang commented. “They have conquered every market they enter.”

US efforts to curb Huawei have not had the desired effect, as the company continues to expand its influence in the field of AI. “We cannot underestimate Huawei,” he warned.

Meanwhile, Intel – the only US company capable of producing advanced chips similar to Nvidia – is struggling with its manufacturing business. The company recently appointed Lip-Bu Tan as CEO to address its leadership crisis.

Denying the information that Nvidia is discussing cooperation with TSMC to invest in Intel, and has not committed to using Intel's chip manufacturing services in the US, Mr. Huang said: "We evaluate Intel's manufacturing technology regularly and are also considering their chip packaging services."

While affirming that he “believes in Intel’s capabilities,” he admitted that “it still takes time to convince both myself and the other side that a new supply chain needs to be built.”

Nvidia's investment of hundreds of billions of dollars in chip manufacturing in the US shows the trend of large enterprises increasing their supply chain autonomy, and reflects strategic adjustments due to the impact of the US-China trade war.

In a fiercely competitive semiconductor industry, the move could impact the future of AI technology and America's position on the global chip map.

Source: https://baoquocte.vn/truoc-nguy-co-ap-thue-nvidia-chot-sieu-du-an-san-xuat-chip-tai-my-giam-phu-thuoc-tu-chau-a-308271.html