According to the people I talked to, for now most of the American semiconductor industry takes an attitude of waiting and seeing. Most of the actions taken this week occurred in the form of investigations. It may take years before punishment is taken. The probes can also be put on the shelf as soon as they were announced, especially if Washington can exchange control over Tiktok to other contracts that Beijing considers to be accepted. (This would probably require reducing existing restrictions that prevent American and Chinese companies from investing in each other as Chinese trade representatives Introduced last weekend). In other words, if trade talks are going well, the regulatory blaster may not have a significant impact.
But if the negotiations stop, these probes may result in real activities-proprietary tariffs addressed to American chip companies that sell China, multi-billion antitrust fines and other potential political means that tilt the chances of the benefit of Chinese companies. “Chinese officials will impose significant penalties only if commercial and economic talks are falling apart, and we will return in the Tit-Tat spiral regarding the control of technologies and penalties,” says Triolo. “If there are penalty, American companies such as Texas instruments and analogue devices can be the goal.”
Overlooked pitch
Until now, companies that produce older systems in the US and China most often avoided becoming the goal of geopolitical restrictions in both countries. But they can show that their position is less convenient in the future.
The hereditary systems that examine Beijing are specially made with technology older than 40-nanometers (Nm). Forty nanometer was the most advanced method of winding chips over 15 years ago; Today it is a profitable way to create less sophisticated systems with basic functions, such as controlling electricity and sound signals.
“The landscape of power systems or analog devices is much more competitive, and the” moat “in this area is lower compared to AI systems,” says Ray Wang, the main analyst of semiconductors at the Futurum Group, a research company. This means that many Chinese companies are already able to produce these tools, although they still remain behind American companies such as Texas, such as Texas, like Texas Instruments.
If China applied anti -dumping tariffs, American chips could suddenly become more costly than local substitutes, which gives competitive acceleration to Chinese companies, such as Novosense, 3Peak, and Joulwatt, Wang says. Of course, the price is only part of the story. American suppliers continue to dominate in terms of reliability, range of products and customer service. But even the loss of a diminutive part of the Chinese market would mean significant revenue losses for American companies – clearly in billions of dollars.
Trade barriers are often losing the game on both sides, but Beijing seems to be ready to play a long game. At least his actions this week suggest that he warns American companies, that to constant access to Chinese markets related to markets. These companies always “expect new funds from the USA, but now they have to think about what kind of Beijing will be,” says Wang.
This is the edition Zeyi Yang AND Louise Matsakis Made in the Chinese Bulletin. Read previous newsletters Here.