Trump calls DeepSeek AI's success a 'wake-up call' for US tech industry

Amid growing concerns over China's AI advancements, Donald Trump pushes for renewed competitiveness in US tech and warns of potential tariffs on foreign-made semiconductor chips

In a recent address at his Doral golf resort in Miami, US President Donald Trump described the success of Chinese AI startup DeepSeek as a “wake-up call” for America’s technology sector, urging US companies to sharpen their focus and maintain competitiveness. He also signalled the potential imposition of tariffs on foreign-made semiconductor chips, including those produced by Taiwan Semiconductor Manufacturing Company (TSMC), unless they start manufacturing in the US.

 

Trump acknowledged the remarkable strides made by DeepSeek in the field of AI, stating, “Today and over the last couple of days, I’ve been reading about China and some of the companies in China, one in particular, coming up with a faster method of AI and much less expensive method. And that’s good, because you don’t have to spend as much money. I view that as a positive, as an asset.”

 

Trump urges US tech firms to compete

 

He further emphasised the importance of staying competitive, saying, “The release of DeepSeek AI from a Chinese company should be a wake-up call for our industries that we need to be laser-focused on competing to win because we have the greatest scientists in the world.”

 

The US President also reiterated his commitment to supporting US tech companies, stating, “Under my administration, we’re going to unleash our tech companies, and we’re going to dominate the future like never before.” He assured American tech firms, “You’ll be doing that too, so you won’t be spending as much, and you’ll get the same result.”

 

DeepSeek AI challenges US tech dominance

 

The launch of DeepSeek’s open-source AI model, R1, last week sent shockwaves through the tech industry, triggering a sharp decline in US tech stocks. Investors are concerned that DeepSeek’s model could challenge the dominance of US companies like Nvidia. The AI model was created with Nvidia’s less advanced H800 chips, which cost less than $6 million—a fraction of what would be needed for more advanced chips.

 

The development has intensified US concerns about China’s rapid AI advancements and the effectiveness of sanctions and export controls. Trump also pointed out that Taiwan’s TSMC, the world’s largest chipmaker, has been pressured by the US to limit sales of advanced chips to China.

 

Trump threatens tariffs, criticises Biden’s plan

 

As part of efforts to bring chip manufacturing back to the US, TSMC is building two plants in Arizona. Trump celebrated the $12 billion plant approved during his first term in 2020, while the second plant, announced under President Biden, is expected to be operational by 2028.

 

However, Trump warned that he might impose tariffs on Taiwan and end US subsidies for TSMC’s US operations, saying, “They left us, and they went to Taiwan, which controls about 98 per cent of the chip business.” He further criticised Biden’s $6 billion subsidy plan for Taiwan, stating, “We don’t need to give them money. They’re going to come back because it’s in their interest to do so.”

 

[With agency inputs]