Busy Week for the Tech Industry Amid Trump Shocking Return to U.S. Presidency

Hello everyone, this is Sisi from Hong Kong. It’s been a busy week for the tech industry, with Asian tech giants starting to report their earnings for the July-September quarter, despite the shock of Donald Trump’s potential return as U.S. President.

For us, including Asian media outlets, it’s also been a hectic time as we’ve been covering what Trump’s second term might mean for trade, defense, markets, and much more. The general consensus seems to be that his return to the White House will bring uncertainty to the region, though some voices argue that Trump may not surprise the world this time around.

One of the biggest impacts could likely be on immigration. Many Chinese citizens, including those from the middle class, who took risky journeys across the Darién Gap to reach the U.S. during the pandemic, are now concerned about being deported under Trump’s policies. Meanwhile, Chinese parents, some of whom sold their property to send their children to study in the U.S., are anxious that their children may be denied entry.

With the Republicans gaining control of both the House and the Senate, Trump is set to become one of the most powerful U.S. presidents of the modern era. Let’s brace for the changes the next four years are bound to bring, whatever they may be.

Impact on the Global Chip Industry

I’m sure many of you are particularly interested in how Trump’s return as U.S. president will affect the global chip industry and the tech supply chain. Please join us for a webinar on November 28 with author Chris Miller, former South Korean trade minister Yeo Han-Koo, and our own chief technology reporter Cheng Ting-Fang, as we dive into this shifting industry. Be sure to register here and submit your questions for the panel in advance.

While Trump won’t take office until January, the world’s largest contract chipmaker is already ensuring it stays on the right side of U.S. export control regulations, regardless of who occupies the White House. Sources told Nikkei Asia’s Cheng Ting-Fang and Lolly Lee that Taiwan Semiconductor Manufacturing Company (TSMC) has suspended the production of AI and high-performance computing chips for several Chinese clients.

These affected Chinese chip design clients are working on high-performance computing, GPU, and AI computing applications using 7nm or more advanced chip production technologies. These chip developers now need a license from the U.S. government to continue working with top chipmakers like TSMC.

There will be no impact on companies making chips for mobile, communications, and connectivity products using the same technology, and sources say that TSMC’s revenue impact will be minimal. However, this move highlights TSMC’s efforts to ensure compliance with U.S. regulations, placing a heavier burden on its customers.

The AI Hardware Race

Financial Times reports that a race is intensifying among major Chinese tech giants to become leading providers of AI-integrated hardware. Eleanor Olcott writes that Baidu, which operates China’s largest search engine, unveiled smart glasses on Tuesday that run on its large language model (LLM), Ernie. The glasses, which will hit stores next year, are developed by Baidu’s hardware brand Xiaodu and are marketed as a “personal assistant” for users. They allow wearers to track calorie consumption, ask questions about their surroundings, play music, and shoot videos.

While Washington’s chip restrictions mean Chinese companies are behind American competitors in developing the most powerful LLMs, experts say they can still leverage the country’s world-class electronics sector to develop competitive AI consumer hardware.

Initially, Baidu’s glasses will only be sold in China, while American tech giants Meta and Snap are competing to dominate markets outside of China.

Growing Focus on Overseas Chinese Consumers

China’s largest annual shopping festival is getting longer and more exhausting for many buyers. With domestic consumption remaining weak, e-commerce platforms are ramping up efforts to reach a potentially lucrative group: the 100 million Chinese living abroad, writes Sisi Zhou for Nikkei Asia.

Alibaba, which launched the sales event in 2009, has spent nearly $200 million filling subway stations in Hong Kong and Taiwan with ads for free shipping on orders over RMB99, along with other offers. Competitors JD.com and Pinduoduo have been less aggressive with their marketing campaigns, but have still made big investments in offering lower prices and affordable shipping to Hong Kong shoppers.

Alibaba reported “strong” GMV (gross merchandise volume) growth and a “record number” of active buyers during this year’s Singles’ Day. The company, along with JD, may release more meaningful data in its upcoming third-quarter earnings call.

The Battery Battle

CATL, the world’s largest supplier of electric vehicle batteries, is trying to meet the growing demand for plug-in hybrids with a new compound battery pack that promises a 400 km range, reports Nikkei’s Shizuka Tanabe.

This move comes as the battery maker faces intense competition from BYD, China’s leading seller of mid-market plug-in hybrids. In May, BYD made changes to its proprietary plug-in hybrid platform to improve its range. The updated DM-i claims a combined fuel and electric range of 2,100 km, though the automaker has focused more on improving engine efficiency, and the platform’s electric range is between 80 km and 120 km.

Sales of plug-in hybrids in China are rising, reaching 3.33 million units between January and September, an 84% increase compared to the same period last year. CATL is betting that the longer electric range will appeal to buyers looking for an “EV experience.”

Related Articles:

• Vietnam Considers New Tech Laws That Could Anger Trump’s U.S. (Nikkei Asia)
• Vision Fund Profits Boost SoftBank’s Return to Profits (FT)
• Kakao: Can South Korea’s Innovation Symbol Regain Its Shine? (Nikkei Asia)
• Nintendo and Sony Enter a “Serious” Holiday Season with No Major Releases (FT)
• SoftBank in Talks with Nvidia for Japan’s ‘AI Grid’ Project (Nikkei Asia)
• Swiggy’s $1.3 Billion Listing Leaves Indian Investors Uninspired (FT)
• Tencent’s Quarterly Results Weaken Due to Weak Consumption in China (Nikkei Asia)
• Singapore Marine Stock Jumps 21% as It Returns to Black (Nikkei Asia)
• SoftBank’s Performance Strengthens Its AI Vision Credibility (FT)
• FTX Sues Binance and Former CEO Changpeng Zhao for $1.8 Billion (FT)

#techAsia is coordinated by Nikkei Asia’s Catherine Krell in Tokyo with assistance from the FT’s Tech Desk in London.

Sign up here to receive #techAsia every week from Nikkei Asia. You can contact the editorial team here: techasia@nex.nikkei.co.jp.