US to Restrict Chip Production for Intel, SK Hynix, and Samsung in China

The US government is planning to restrict Intel, SK Hynix, and Samsung's ability to manufacture chips in China. The move aims to limit the companies' reliance on China's chip production capacity and promote domestic semiconductor manufacturing in the US. Intel, the world's leading semiconductor manufacturer, is heavily reliant on China for chip production.

The U.S. government is planning to restrict Intel, SK Hynix, and Samsung's ability to manufacture chips in China. This move aims to limit the companies' reliance on China's chip production capacity and promote domestic semiconductor manufacturing in the U.S. The decision follows increasing concerns about the strategic importance of semiconductors and the potential national security implications of over-reliance on foreign manufacturing.

Intel, the world's leading semiconductor manufacturer, has been heavily reliant on China for chip production. The company has faced significant competition in recent years, with its fabrication business suffering under increasing competition from TSMC and Samsung. Despite receiving a major investment from the last government's CHIPS act, Intel has been considering selling its entire chip manufacturing arm of its business [2].

SK Hynix, a South Korean semiconductor company, and Samsung Electronics have also been involved in discussions about semiconductor cooperation with U.S. companies. At the "South Korea-U.S. Business Roundtable" held in Washington, D.C., officials discussed a plan for Samsung Electronics and SK hynix to supply semiconductor chips optimized for NVIDIA’s supercomputers. The event highlighted a strong atmosphere of collaboration between South Korean and U.S. semiconductor companies [1].

The U.S. government's move to restrict chip manufacturing in China comes amidst a broader trend of increasing government involvement in the semiconductor industry. The Trump administration has made itself "The Commander in Chief of the Chip Industry," allowing Nvidia and AMD to resume shipments of advanced AI chips to China in return for a significant revenue share [3]. This deal, while controversial, has opened immediate revenue pathways for chipmakers by reinstating access to China’s massive AI development market.

The global semiconductor market is gaining momentum, with the World Semiconductor Trade Statistics (WSTS) organization forecasting 15.4% annual growth for 2025. The surge is driven by strong demand for AI infrastructure buildouts and early-stage edge AI adoption. However, the market is increasingly shaped by technological relevance, with segments tied to next-gen compute and AI infrastructure capturing outsized value [3].

The U.S. government's move to restrict chip manufacturing in China is part of a broader strategy to promote domestic semiconductor manufacturing and reduce reliance on foreign production. The implications for Intel, SK Hynix, and Samsung are significant, as they will need to adapt their manufacturing strategies to comply with the new restrictions. The move also highlights the growing importance of semiconductors in national security and economic competitiveness.

References:
[1] https://www.donga.com/en/article/all/20250827/5810524/1
[2] https://www.tomshardware.com/tech-industry/semiconductors/intel-confirms-it-has-already-received-usd5-7-billion-from-us-government-cfo-claims-the-deal-was-to-halt-the-sale-of-its-chip-fabs
[3] https://sourceability.com/post/trump-chip-export-levy-reshapes-semiconductor-trade