Estimated reading time: 9 minutes

The Government Circuit: Trump’s Trade War Disrupts the Electronics Ecosystem

There is certainly no shortage of work to be done in the IPC Government Relations department, as the U.S. waged a tariff campaign on practically every industrial country in the world and several countries embarked on high-tech initiatives with a mix of approaches to the crucial foundations of electronics manufacturing.  

Indeed, the breadth and speed of U.S. President Donald Trump’s tariff campaign continues to be a serious challenge for our industry.    

Most notably, in recent weeks, Trump alerted reporters¹ that semiconductors may soon be subject to new tariffs, and the next day, he added “the WHOLE ELECTRONICS SUPPLY CHAIN” in a post on social media. As the voice of the electronics supply chain, IPC took notice and stepped up its advocacy work.  

On April 14, the U.S. Department of Commerce launched a formal investigation² into semiconductors, semiconductor manufacturing equipment, and “derivative products” including “substrates and bare wafers, legacy chips, leading-edge chips, microelectronics, and SME components,” as well as “downstream products that contain semiconductors, such as those that make up the electronics supply chain.” Depending on how any subsequent tariffs are structured, the exact scope of coverage could affect many IPC members. 

As this article is being written, the public comment period is about to close, and IPC is preparing comments to submit on behalf of our industry. 

In another trade matter of direct concern to electronics, IPC submitted comments to the Commerce Department for its investigation of copper imports. Copper is used widely across the electronics value chain, and the imposition of U.S. tariffs would interfere with the industry’s recent re-shoring trend. Many domestic manufacturers depend on specialty products like copper foils that are only available from foreign sources. 

The copper and semiconductor investigations were launched against an even wider trade war, as the Trump administration’s “universal” and “reciprocal” tariffs took effect on April 2, along with tariffs on imported autos and auto parts. Then, on April 9, after several days of steep stock market drops, Trump announced a 90-day pause on the reciprocal tariffs for more than 75 countries, while the 10% “universal” tariff remained in effect. On April 12, the White House announced exclusions for key electronics products, including laptops, smartphones, computer parts, telecommunications equipment, and other critical inputs. 

In an April 2 statement³, IPC warned that blanket tariffs would drive up production costs, create uncertainties, and strain supply chains. IPC’s formal comments to the U.S. Trade Representative (USTR) urged the administration to exempt imports of raw materials, components, and equipment essential to U.S. electronics manufacturing and to pursue diplomatic solutions instead of blanket tariffs. Reuters, The Hill, and CNET included IPC in their coverage of industry reactions.

Given the global nature of many electronics companies’ supply chains, IPC is tracking these developments and sharing information with our members. A pair of webinars for our U.S. and European members drew over 300 and 200 attendees, respectively. 

Of course, IPC’s government relations team is also prioritizing engagement with the U.S. Department of Commerce, the U.S. Trade Representative, and key members of Congress to advocate for our industry.

Stay tuned to our accounts on LinkedIn, subscribe to our weekly Global Advocacy Report, or check out our Trade Policy landing page on IPC.org for all the latest details and IPC analysis. 

Will Trump Finish What He Started on Defense Electronics? 
The second Trump administration must build on what the first one started to strengthen the U.S. defense electronics base, according to an op-ed4 by Richard Cappetto of IPC and James Will of the U.S. Partnership for Assured Electronics (USPAE). They say that despite supportive declarations by Presidents Trump and Biden, “too little” has been done to close gaps in the defense electronics industrial base. “The United States continues to marginalize investments in the PCB industry and related technologies that are crucial to U.S. military superiority and mission-critical functions carried out by warfighters,” they write. Cappetto and Will urge the U.S. Government to “inject capital into the PCB sector; rebuild direct connections between industry and the Pentagon; and enforce “trusted supplier” standards. If you agree, please like and share this LinkedIn post by USPAE. 

AI Depends on Electronics, IPC Tells White House
Following President Trump’s guidance to the White House Office of Science and Technology (OSTP) to develop new national strategies on artificial intelligence (AI) and other technologies, IPC submitted official comments reiterating our position that leadership in AI depends not only on software and data but also on a strong electronics manufacturing base. Specifically, AI innovation requires secure, advanced hardware, including IC substrates, printed circuit boards (PCBs), high-bandwidth memory, and advanced packaging. IPC urged the government to invest in five key areas: IC substrate fabrication; AI component assembly and testing; high-bandwidth manufacturing; PCB/HDI production; and PCB assembly. IPC also recommended tax incentives and stronger demand signals to bolster U.S. manufacturing. 

EU Advances New Defense Strategy; IPC Highlights the Electronics Gaps
In late March, the European Commission adopted a White Paper on the future of European defense, along with the ReArm Europe plan to strengthen defense readiness by 2030. Within days, IPC released a new report⁵ that urges European policymakers to prioritize electronics in defense industrial policies to ensure a resilient and competitive supply chain. The issue is critical for IPC and its members, as a strong European defense electronics ecosystem is essential for supply chain security, innovation, and long-term industry growth.

Mexico Unveils Semiconductor Industry Roadmap 
In a major step forward for regional tech integration, the U.S. Embassy in Mexico and Canieti (Mexico’s National Chamber of Electronics, Telecommunications, and Information Technologies) released a joint Master Plan for the Development of the Semiconductor Industry. The plan sets ambitious goals to double exports and job creation in the sector by 2030, with a focus on workforce development, investment attraction, and supply chain integration. As Mexico News Daily reported⁶, the Mexican government is designing a program of incentives similar to those adopted in the United States to develop the semiconductor industry and spur technological innovation. 

Mexico also opened its first National Laboratory for Semiconductor Design and Advanced Electronics at the Aguascalientes Institute of Technology (ITA). Outfitted with advanced technology tools, the lab will strengthen Mexico’s capabilities in Assembly, Testing & Packaging (ATP) and support the development of a domestic semiconductor ecosystem. 

If successful, these initiatives could strengthen Mexico’s position in the global semiconductor ecosystem and create new opportunities for electronics manufacturers. 

India Plans to Expand Electronics Output, Including in Defense 
In late March, India’s Union Cabinet approved a “much-awaited” Production Linked Incentive (PLI) scheme for electronics component manufacturing with an outlay of $2.6 billion (Rs 22,919 crore). The scheme will cover components like display module sub-assemblies; electro-mechanicals for electronic applications; multi-layer printed circuit boards (PCBs); enclosures for mobile, IT hardware products and related devices; and lithium-ion cells for digital applications, the Economic Times reported⁷. “We need to come out of import substitution mindset and start manufacturing for us for the rest of the world,” Union Electronics and IT Minister Ashwini Vaishnaw said at a press conference in New Delhi (Outlook Business, Mar. 28). 

Meanwhile, the value of India's defense production is expected to surpass $18.8 billion (Rs 1.6 lakh crore) this year and reach $35.1 billion (Rs 3 lakh crore) by 2029, the nation’s defense minister said. Speaking at DefConnect 2024 in New Delhi, Defense Minister Rajnath Singh emphasized the government's commitment to reducing reliance on foreign defense imports and promoting indigenous innovation. The Indian government reports that defense exports have grown more than 20-fold over the past decade, according to The Economic Times. IPC continues to monitor developments in India’s defense and electronics manufacturing landscape, particularly as new procurement, localization, and offset policies emerge.

IPC EMS Advocacy Day in Washington, June 11
If you’re involved in the electronics manufacturing services (EMS) sector, come and join your peers in Washington, D.C., on June 11 to talk strategy and speak with top policymakers on the industry's most pressing challenges and opportunities. Attendees will hear from congressional staff and agency officials, share their perspectives on key issues, and help shape IPC’s advocacy strategy moving forward. Space is limited, so early registration is encouraged. Learn more and register here.

New Faces on Team IPC
IPC has recently brought on three new executives in our never-ending effort to be the most effective advocate and supporter possible for the global electronics industry. 

• Joseph Schneider is now IPC’s Vice President of U.S./Canada. This newly created position reflects the association’s focus on meeting the evolving needs of manufacturers in the U.S. and Canada. 
• Carrie Sessine is our first-ever Vice President of Global Communications, charged with elevating the electronics manufacturing industry's visibility and impact.
• Thiago Guimarães is IPC’s new Director of Industry Intelligence, in charge of gathering and disseminating data-driven insights to help the industry respond more effectively to shifting geopolitical and economic forces.

Please follow our new colleagues on LinkedIn and let them know if you have any insights, questions, or ideas to share. 

What Are Your Concerns?
We all at IPC imagine a future in which every nation sources the electronics needed for its national security, critical infrastructure, and key industries from trusted suppliers with more secure supply chains. 

That’s why we will continue to engage with policymakers and key players in many nations as we seek to build partnerships for progress. Please let us know your thoughts.

References

1. “Trump announces semiconductor chip tariffs on foreign electronics,” Reuters, New York Post, April 14, 2025.
2. Notice of Request for Public Comments on Section 232 National Security Investigation of Imports of Semiconductors and Semiconductor Manufacturing Equipment, Federal Register.
3. Statement from IPC on ‘Liberation Day’ Pressing for Domestic Manufacturing Strategy, IPC.org, April 2, 2025.
4. “Trump’s Opportunity to Finish What he Started on Defense Electronics,” by Richard Cappetto and James Will, RealClear Defense, April 23, 2025.
5. “Securing the Electronics Value Chain: The Blind Spot in the European Union’s Defence Agenda,” a white paper authored by IPC.
6. “Mexico and US present semiconductor industry roadmap to double exports and jobs,” Mexico News Daily, Oct. 22, 2024.
7. “Govt to notify Rs 23K cr electronics manufacturing scheme in three weeks: Vaishnaw,” The Economic Times, March 29, 2025.

Chris Mitchell is IPC’s VP of global government affairs. Contact him at ChrisMitchell@ipc.org.