Decision forces president to choose between consumer prices and domestic chip production
Apple has told the Trump administration that using memory chips from China’s ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies (YMTC) in iPhones, iPads and other devices sold outside the United States would help ease a global chip shortage and lower prices for American consumers, people familiar with the discussions said. Apple CEO Tim Cook and other senior executives have made the case directly to President Trump, Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent in recent weeks.
Micron Technology, the only sizable U.S. manufacturer of memory chips, is pushing back with equal intensity. CEO Sanjay Mehrotra and other Micron executives have warned Lutnick and other administration officials that allowing CXMT and YMTC to sell to U.S. tech companies, even for products sold abroad, could hollow out the domestic memory-chip industry, according to the people. Micron’s argument echoes the history of U.S. steel and manufacturing, where China’s emergence as a low-cost producer decimated American plants.
The lobbying fight forces a difficult choice for Trump, who has sought to cut consumer prices while also making increased domestic semiconductor production a signature economic goal. White House spokesman Kush Desai said the administration would pursue “investments and economic relief for the American people while safeguarding our national security,” without indicating which way the president was leaning.
The debate over Chinese chips has intensified as a memory-supply squeeze, driven by surging artificial-intelligence demand from data centers, has pushed DRAM prices up roughly fourfold in the past year, according to research firm TechInsights. Apple, one of the world’s largest memory buyers, says Micron’s gross profit margins — now surpassing 80% — are evidence of price gouging, and that Micron is directing too little new production capacity toward consumer-electronics customers. Micron counters that it plans to spend $250 billion in the U.S. to boost capacity and that the current shortage is in part a consequence of past buyer pressure that squeezed suppliers during earlier downturns.
Both CXMT and YMTC have been designated as Chinese military companies by the Pentagon, and YMTC is also on a trade blacklist known as the entity list. Michael Kratsios, director of the White House Office of Science and Technology Policy, told lawmakers this week that “the most important thing is we have to build capacity here” and “we obviously don’t want to be doing business with anyone that’s on the entity list.”
Apple and Micron each have cultivated close ties to the administration. Cook traveled with Trump to China for a summit earlier this year and last year presented the president with a plaque in the Oval Office as part of an effort to win tariff exemptions. Micron has said it will invest $250 million to match federal funding for Trump-branded savings accounts for newborns. Both Cook and Mehrotra have appeared alongside Trump in the Oval Office. Lutnick speaks regularly with both CEOs, the people said.
The dispute revives a battle from 2022, when Apple completed engineering work to qualify YMTC chips for its products. After the relationship became public, Marco Rubio, then a senator and now secretary of state, said Apple was “playing with fire,” and the Biden administration added YMTC to the entity list. Rubio’s office has some involvement in the current discussions, though Lutnick and Bessent are seen as leading the administration’s handling of the matter, according to people familiar.