Apple (NASDAQ: AAPL) is facing direct pressure from the Trump administration to avoid sourcing memory chips from Chinese manufacturers as a global shortage tightens supply across the industry.
Commerce Secretary Howard Lutnick said he personally told Apple that the administration opposed major American companies purchasing memory chips from Chinese suppliers.
Apple has been testing chips from ChangXin Memory Technologies and Yangtze Memory Technologies for potential use in devices sold within China, according to people familiar with the matter.
Surging demand from AI data center operators has created a significant shortage of memory chips, pushing prices sharply higher across the consumer electronics sector.
The increased costs have forced Apple and other consumer-electronics manufacturers to raise product prices as supply constraints continue to weigh on the market.
Apple Chief Operating Officer Sabih Khan declined to confirm the company was testing Chinese chips, but acknowledged the scale of the shortage required examining all available options.
Khan added that those options include working with existing suppliers to help expand production capacity within the United States.
US regulations currently require American companies to obtain licenses before sharing product information with ChangXin Memory Technologies or Yangtze Memory Technologies, information that would be necessary to produce customized chips for Apple.
Apple retains the ability to purchase standard, off-the-shelf memory components from the Chinese firms and negotiate pricing without triggering those licensing requirements.
Micron Technology (NASDAQ: MU) has lobbied the administration to block Apple from sourcing Chinese memory, arguing such purchases would undermine domestic manufacturing and contradict Washington’s semiconductor reshoring agenda.
Senators representing states where memory-chip producers plan to build new facilities wrote to Apple CEO Tim Cook in July, urging the company to avoid partnering with Chinese suppliers.
The dispute adds a new layer of friction to an already strained relationship between Apple and the administration over the pace of supply chain relocation to the United States.
Washington has secured a commitment for Intel (NASDAQ: INTC) to manufacture some Apple chips domestically, along with an agreement for iPhone and Apple Watch cover glass to be produced in the US.
Apple has expanded Mac Mini assembly operations in Texas, but the overwhelming majority of its supply chain remains concentrated in Asia, with growing iPhone production capacity being developed in India.
