Tariffs push Apple closer to Asia and Alibaba challenges DeepSeek

Hey everybody! That is Lauly, sending greetings from Taipei.

Normally, individuals in Taiwan take pleasure in a four-day vacation in the beginning of April — Kids’s Day and Tomb-Sweeping Day (a little bit of an odd mixture, I do know). However this 12 months was totally different, no less than for individuals concerned within the tech and media industries, due to Donald Trump’s “reciprocal” tariffs. An business pal jokingly mentioned that the US president had turned the vacation into an actual “tomb-sweeping day”.

Personally, the primary two weeks after Trump’s announcement had been a nightmare as I chased sources throughout the availability chain for his or her reactions, tried to grasp myself what was happening, and on prime of that took care of my son, who was sick your entire time.

I used to be significantly surprised after I came upon {that a} scoop my colleague and I had drafted the night time earlier than had turn into practically ineffective the following morning after Trump all of the sudden mentioned that each nation besides China would have a 90-day grace interval on the brand new tariffs. We needed to begin over, going again to sources and remodeling the story. I shared my emotions with a longtime business pal and he mentioned, “Now you understand how we now have felt on a regular basis since April 2.”

Nearly everybody I’ve met just lately has had large darkish circles underneath their eyes. Paul Peng, chair of main Taiwanese show maker AUO, mentioned: “Individuals requested what we must always do. I’ve solely two items of recommendation: Eat nicely and sleep nicely.” I feel such a peaceful mindset is what I wanted, too.

After working feverishly for 3 weeks, together with weekends, I left every little thing behind and made a spontaneous quick journey with my household to Solar Moon Lake within the central Taiwanese metropolis of Nantou final week. It was the very best resolution I made just lately. The climate was excellent and the turquoise lake, stretching out in the direction of misty, forested mountains, radiated tranquility. Solar Moon Lake all the time has a magic means to right away calm down your muscle tissue, make your breath deeper and calm your thoughts. For those who ever come to Taiwan, I extremely advocate a visit to Solar Moon Lake.

The quick journey — which included a beautiful night-time firefly tour that my son completely cherished — helped recharge my power and reset my exhausted mind. The tariff struggle was simply as chaotic after I returned to work this week, however I really feel I’ve extra capability to deal with the uncertainties.

And nothing lasts perpetually, in any case. A senior government with an Apple provider who has been within the business for greater than 40 years instructed me he thinks the tariff struggle will de-escalate in two or three months after which the availability chain ought to have a clearer image of what to do subsequent. “And let’s see,” he added, “whether or not the tariff struggle will ‘Make America Nice Once more’ or ‘Make America Nice Alone.’”

In different information, #techAsia can be taking a break subsequent week because of the Golden Week vacation in Japan. We can be again to our common schedule on Might 15. See you then!

Reverse final result

What was the primary response by Apple when the Trump administration escalated tariffs on Chinese language imports to as excessive as 145 per cent? As an alternative of dashing to convey manufacturing residence, it doubled down on south-east Asia and India. The Cupertino-based tech big’s instant technique to cope with the tariff struggle reveals simply how far off a “Made in America” iPhone stays, even when Trump and his commerce secretary, Howard Lutnick, insist in any other case, write Nikkei Asia’s Lauly Li and Cheng Ting-Fang.

Apple helped suppliers to purchase tools to spice up manufacturing, instructed suppliers that almost all of US-bound iPhones, MacBooks and iPads need to be made in India and Vietnam, and rushed extra part manufacturing to Thailand, as Nikkei Asia first reported in mid-April.

Nonetheless, the truth is that even south-east Asia and India — the place Apple and different electronics makers have been pushing onerous to diversify manufacturing for years — nonetheless battle to compete in opposition to China and its ultra-efficient provide chain, by no means thoughts transferring such manufacturing to the US

Shifting a whole provide chain is extraordinarily difficult. As an illustration, whereas some MacBooks, Mac Mini and iMacs are actually labelled “Made in Vietnam” or “Made in Thailand”, not all the parts had been produced or all the meeting carried on the market attributable to lack of enough technicians, expert staff, whereas some low-margin parts usually are not but possible to be moved out of China.

Cluster impact

Chinese language tech big Huawei is making strides within the synthetic intelligence chip market, having started deliveries of its superior AI “cluster” to home shoppers, writes the Monetary Occasions’ Zijing Wu.

The transfer comes as Chinese language firms face rising limitations on accessing Nvidia’s high-end semiconductors due to tightening US export controls.

Sources point out that Huawei has already offered over 10 units of its CloudMatrix 384, a system that interconnects a considerable variety of AI chips. These preliminary deliveries are destined for knowledge centres serving numerous Chinese language tech companies.

Business analysts have been impressed by Huawei’s speedy improvement and deployment of CloudMatrix.

“The event of Huawei’s CloudMatrix 384 means China now has an AI system able to beating Nvidia’s,” mentioned Dylan Patel, founding father of chip consultancy SemiAnalysis.

Huawei has instructed shoppers its CloudMatrix performs considerably higher than Nvidia’s fashionable NVL72 cluster by way of computing energy and reminiscence, based on an organization presentation reviewed by the Monetary Occasions and other people with information of the matter.

CloudMatrix 384 does have a number of disadvantages, together with greater power consumption and extra demanding software program upkeep. However given China’s considerable energy sources and engineering expertise, it nonetheless represents a compelling different for shoppers now restricted from Nvidia’s most superior expertise, mentioned individuals with information of the gross sales.

AI optimism

Unimicron, Taiwan’s main provider of chip substrate and printed circuit boards, expects sturdy demand from high-end AI knowledge centres to drive higher growth — if the tariff struggle between the US and China doesn’t escalate additional, Nikkei Asia’s Cheng Ting-Fang and Lauly Li write.

“To this point, we don’t see any clients adjusting their orders because of the tariffs, however general we do have issues that greater tariffs or escalating geopolitical tensions might hit international demand and finally, immediately or not directly, impression orders,” firm chair TJ Tseng mentioned.

Unimicron, which counts Nvidia, Intel and Apple amongst its clients, is at present constructing its first manufacturing facility in Thailand, with plans for it to enter manufacturing within the second half of this 12 months.

Tseng mentioned his firm has been contemplating investing within the US in response to current geopolitical developments, however has no concrete plans to take action in the meanwhile given the shortage of a provide chain and buyer demand to help such a transfer.

Alibaba’s DeepSeek riposte

The AI mannequin race in China is getting hotter and warmer. E-commerce big Alibaba launched Qwen3, the newest technology of its open-source giant language mannequin household, in a bid to challenge DeepSeek in synthetic intelligence capabilities and effectivity, writes Nikkei Asia’s Cissy Zhou.

Alibaba mentioned Qwen3 sharply reduces computing energy in contrast with its friends and that its flagship Qwen3-235B-A22B outperforms numerous fashions launched by main rivals — specifically DeepSeek-R1, OpenAI-o1, Grok-3 and Gemini-2.5-Professional — in a variety of benchmark exams. These embrace mathematical reasoning, coding proficiency, and power and performance calling capabilities, a measure of a mannequin’s means to pick and use the very best exterior instruments for a job.

The extremely anticipated launch, which native media says took round seven months of labor, comes as competitors heats up amongst Chinese language AI firms, significantly because the emergence of DeepSeek early this 12 months. Final week, Baidu launched two new AI basis fashions that it claims price “a fraction” of comparable choices from DeepSeek.

Urged reads

1. Japan’s Sakana AI sees opportunity with US uncertainty (Nikkei Asia)

2. Baidu founder highlights ‘shrinking’ demand for DeepSeek’s text-based AI (FT)

3. Toyota picks Huawei, Honda uses DeepSeek for China EVs (Nikkei Asia)

4. Samsung warns US tariffs will dent memory chip and smartphone sales (FT)

5. Amazon pressures suppliers to cut prices to limit Trump tariff shock (FT)

6. Japan’s lower house passes AI bill as nation targets Western investment (Nikkei Asia)

7. Intel CEO Lip-Bu Tan hints at foundry collaboration with TSMC (Nikkei Asia)

8. China and South Korea extend battery battle from EVs to grid storage (FT)

9. TikTok to enter Japan e-commerce as it seeks expansion outside US (Nikkei Asia)

10. Apple aims to source all US iPhones from India in pivot away from China (FT)