CEOs of US Chip Companies Organize Trip to Washington for Discussions on China Policy, According to Sources

CEOs of US Chip Companies Organize Trip to Washington for Discussions on China Policy

According to two insider sources, the chief executives of Intel Corp and Qualcomm Inc are arranging a trip to Washington D.C. next week to discuss matters related to China policy. The purpose of their visit is to hold meetings with U.S. officials, addressing topics such as market conditions, export controls, and other issues impacting their businesses. However, the specific officials they will be meeting with remain undisclosed. Both Intel and Qualcomm declined to comment, and the White House officials did not respond to a comment request. The sources mentioned that additional CEOs from semiconductor companies may also be present in Washington during the same time, but they chose to remain anonymous as they are not authorized to speak to the media.

In June, sources revealed that U.S. officials were contemplating stricter export regulations that would affect high-performance computing chips and shipments to Huawei Technologies Co Ltd. If implemented, these regulations would have consequences for Intel, which is developing a new artificial intelligence chip intended for China, as well as Qualcomm, which possesses a license to sell chips to Huawei.

In October of last year, the Biden administration issued comprehensive rules with the aim of stabilizing China’s semiconductor industry while investing billions of dollars in subsidies into the U.S. chip industry.

The potential tightening of export rules would significantly impact Nvidia, which holds a strong position in the AI chip market and reached a market value of $1 trillion earlier this year.

In recent years, the chip industry has been well-received in Washington, as lawmakers and the White House endeavor to shift more production to the United States and its allies, moving away from China. Intel CEO Pat Gelsinger and Qualcomm CEO Cristiano Amon have frequently engaged with government officials.

The upcoming meetings, which may involve joint sessions between executives and U.S. officials, are taking place at a time when Nvidia Corp and other chip companies are concerned about permanent sales losses due to escalating tensions between Washington and Beijing, particularly for an industry heavily reliant on business with China.

One of the sources familiar with the matter stated that the CEOs’ objective for the meetings is to ensure that government officials comprehend the potential consequences of further tightening regulations on chip sales to China.

Many U.S. chip companies generate over a fifth of their revenue from China, and industry executives argue that reducing those sales would diminish profits that are typically reinvested in research and development.