On what he declared as “Liberation Day,” President Donald Trump unveiled his highly anticipated Master Tariff Plan. True to his signature style, he framed the policy as a revival of American industry, promising a new “Golden Age of America.” While his promises were grand, reactions from international business and political circles have been mixed—especially regarding its implications for the semiconductor industry. In fact, a key piece of semiconductor-related news was buried in the details, which we break down in this article.
Image courtesy of Newsweek
Trump’s Vision: Tariffs as the Path to Economic Revival
Trump has long argued that the U.S. has been exploited through unfair trade tactics, including excessive foreign tariffs, currency manipulation, and price fixing—practices he says have contributed to trillions in trade deficits. To counteract these, his plan introduces a structured tariff system, which he says are “nice tariffs,” designed to level the playing field.
During his announcement, he highlighted extreme examples of foreign tariffs:
China’s 65% tariff on U.S. rice
South Korea’s tariffs ranging from 50% to 513% on rice
Japan’s staggering 700% tariff on rice
The U.S., by contrast, charges as little as 2.5%
Trump’s stated goal is to incentivize companies to relocate their manufacturing to the U.S., allowing them to operate tariff-free. He also emphasized that before 1913, tariffs were the government’s primary revenue source—suggesting that restoring this model could reduce Americans’ growing income tax burden. He is absolutely certain that he is pushing the reset button on the American economy and it will come back to vibrant life, “America’s industry will be reborn, it’s destiny reclaimed”, and this will make “America wealthy again”. The President encouraged blue-collar workers attending the announcement with a new slogan “We will build our future with American hands, American hearts, American steel, and American pride!”
Billions in Promised Investments
Trump touted approximately $3 trillion in investment commitments from major corporations planning to expand operations in the U.S. He specifically named Apple, Nvidia, TSMC, Johnson & Johnson, Eli Lilly, SoftBank, Oracle, Merck, Meta, Stellantis, Honda, Nissan, and Hyundai. However, turning promises into reality is another matter. Businesses require stability and long-term policy consistency before making major investments. Given Trump’s history of shifting stances, some analysts worry that corporations may hesitate to fully commit. Additionally, while the vision of new American factories is compelling, large-scale production facilities take years to plan and build. If political leadership or policies change in the next four years, will companies abandon these projects before completion? Another key question: Will these new plants create widespread employment, or will automation replace many of the jobs once performed by blue-collar workers anyway?
Semiconductors: The Unexpected Exception
One surprising aspect of the tariff plan is that semiconductors—along with a few other products—are exempt from the reciprocal tariffs. Given Trump’s past emphasis on semiconductor production as a matter of national security, this exclusion raises questions. While the official reasoning remains unclear, it suggests that the administration may be pursuing an alternative strategy to boost domestic chip manufacturing.
Here’s what the White House Fact Sheet states regarding semiconductor tariffs:
“Some goods will not be subject to the Reciprocal Tariff. These include: (1) articles subject to 50 USC 1702(b); (2) steel/aluminum articles and autos/auto parts already subject to Section 232 tariffs; (3) copper, pharmaceuticals, semiconductors, and lumber articles; (4) all articles that may become subject to future section 232 tariffs; (5) bullion; and (6) energy and other certain minerals that are not available in the United States.”
You can read the full Fact Sheet here: White House Fact Sheet
Potential Risks: Inflation, Delays, and Global Competition
While Trump presents his tariff plan as a “common sense” solution, economic experts and business leaders have raised concerns:
Inflationary Pressures: Higher import costs could lead to rising consumer prices, potentially slowing spending and leading to layoffs rather than the promised job growth.
Manufacturing Delays: Relocating production is a long-term process. If businesses lack confidence in policy stability, they may delay or cancel U.S. expansion plans.
China’s Competitive Edge: While U.S. manufacturers focus on moving operations, China continues advancing in key industries—particularly electric vehicles. If American companies divert resources to relocation instead of innovation, could China solidify its growing dominance?
How AERI Can Help
Trump’s tariff plan is likely to bring both benefits and challenges. While it may drive some manufacturing back to the U.S., it could also lead to supply chain disruptions and price fluctuations. At AERI, we specialize in helping businesses navigate these uncertainties. If tariffs impact your procurement strategy, our Search Experts can help locate cost-effective components to “keep your production lines moving”. Stay ahead of the changes, stay informed, and reach out to AERI for expert support in this evolving landscape.
