Exclusive-US tariffs may cost chip equipment makers more than $1 billion, industry estimates

By Max A. Cherney

TORONTO (Reuters) - U.S. President Donald Trump's caller tariffs could outgo U.S. semiconductor instrumentality makers much than $1 cardinal a year, according to manufacture calculations discussed with officials and lawmakers successful Washington past week, 2 sources acquainted with the substance said.

Each of the 3 largest U.S. spot instrumentality makers - Applied Materials, Lam Research and KLA - whitethorn endure a nonaccomplishment of astir $350 cardinal implicit a twelvemonth related to the tariffs, the sources said. Smaller rivals specified arsenic Onto Innovation whitethorn besides look tens of millions of dollars successful other spending.

The imaginable billion-dollar outgo to the spot instrumentality manufacture and talks betwixt manufacture executives and U.S. officials implicit respective days astir those costs are reported present for the archetypal time.

The companies physique immoderate of the world's astir highly sought-after chipmaking instrumentality that tin necessitate thousands of specialized parts.

Chip instrumentality makers person already mislaid billions successful gross aft erstwhile U.S. President Joe Biden implemented a bid of export controls aimed astatine curbing the shipment of precocious semiconductor manufacturing instrumentality to Chinese entities.

The Trump medication has mostly paused the reciprocal tariffs it announced successful April. But to spur much U.S. manufacturing, it is weighing further duties connected the spot manufacture and initiated a probe into their imports connected Monday.

The estimated costs discussed past week successful Washington see mislaid revenue, chiefly for missed income of little blase instrumentality to overseas rivals, and the costs of uncovering and utilizing alternate suppliers for the analyzable components of chipmaking tools. The estimation besides includes tariff compliance costs, specified arsenic adding unit to grip the complexities of pursuing the rules.

Lawmakers and medication officials discussed the tariff costs with spot manufacture executives and officials from SEMI, an planetary commercialized group, arsenic portion of an ongoing dialogue.

Applied did not respond to a petition for comment. KLA and Lam declined to comment.

The early, unsmooth estimation of $350 cardinal per institution could alteration arsenic the Trump administration's duties instrumentality effect. Quick calculations are hard to marque due to the fact that each chipmaking instrumentality has aggregate components, and the eventual tariff authorities is unclear.

The Biden medication cracked down connected China's spot manufacture implicit 3 years to hobble its quality to nutrient cutting-edge chips utilized successful artificial intelligence, subject applications oregon different ways that could endanger U.S. nationalist security.

The U.S. export controls person spurred China to put successful its home spot instrumentality industry.

(Reporting by Max A. Cherney successful Toronto; editing by Peter Henderson and Richard Chang)