Silicon Valley Tech News Roundup – March 5th

China reacts to the US ban of TikTok on federal devices – 3/1

During a news briefing on Tuesday, Mao Ning (spokesperson for China’s Foreign Ministry) hit back at the U. S. government and accused it of overreacting after it ordered all federal employees to remove TikTok app from their government-issued phones.

Ning stated to the reporters: “We firmly oppose those wrong actions… The US government should respect the principles of market economy and fair competition, stop suppressing the companies and provide an open, fair and non-discriminatory environment for foreign companies in the US… How unsure of itself can the world’s top superpower like the US be to fear young people’s favorite app like that?”

White House instructed all government agencies they have 30 days to ensure their employees removed TikTok from their devices. Shalanda Young (the US Office of Management and Budget Director) told all the agencies to remove the app from all state-issued phones to protect confidential data.

Likewise, Republicans in Congress are expected to pass additional legislation that would give power to President Biden to ban the app nationally. TikTok’s spokesperson stated: “We hope that when it comes to addressing national security concerns about TikTok beyond government devices, Congress will explore solutions that won’t have the effect of censoring the voices of millions of Americans.”

Governments in the EU and Canada implemented similar decisions.

CHIPS funding recipients cannot expand in China – 3/4

This week, the US Commerce Department announced it would start accepting applications for the CHIPS Act in June. Congress passed the bill in July last year as a bipartisan effort and its purpose is to fund US semiconductor companies looking to expand domestic production.

The US Commerce Department also outlined requirements the applicants will need to satisfy in order to be eligible. They mandate the companies have to sign agreements ensuring they do not intend to expand their production capacities in China. Likewise, another condition is the companies have to create a plan detailing how they intend to provide affordable childcare for workers.

Gina Raimondo (Commerce Secretary) stated: “Recipients will be required to enter into an agreement restricting their ability to expand semiconductor manufacturing capacity in foreign countries of concern for a period of 10 years after taking the money.” She further added companies cannot “knowingly engage in any joint research or technology licensing effort with a foreign entity of concern that involves sensitive technologies or products.”

Foxconn to build a new plant in India – 3/3

On Friday, Bloomberg reported Foxconn (the largest manufacturer of iPhone components) plans to build a new factory in Karnataka state in India. The company will invest $700 million building a new plant on a 300-acre plot of land close to Kempegowda International Airport in Bengaluru (Bangalore). The city is the tech and engineering hub of the country. Estimates are the plant will create 100,000 new jobs over a period of ten years.

Young Liu (the CEO and Chairman of Foxconn) visited India this week and met with Prime Minister Narendra Modi. While Liu did not specify any investment spending during the trip, Karnataka’s investment promotion office announced the land has been allocated for a facility.

Foxconn and other suppliers are looking for a potential alternative manufacturing hub to China. Last year, all suppliers faced massive production delays because of Covid lockdowns.

Tesla plans to build a new factory in Mexico – 3/1

On Wednesday, Elon Musk announced Tesla’s plans to build a new factory in Mexico. The President of Mexico Andres Manuel Lopez Obrador stated the factory would be close to Monterrey.

Meanwhile, Jesus Nava (Mayor of Santa Catarina in Nuevo Leon) stated on Thursday the plot of land intended for the factory covers 4,200 acres in an industrial zone. The construction should start in three months. The size of the plant would be almost double the size of Tesla’s plant in Texas. Likewise, Nava said, initially, Tesla plans to spend around $5 billion and create 5,000 new jobs. The total investment, according to Nava, would be $10 billion and create 10,000 new jobs.

An unnamed Mexican official stated the Mexican plant would be a “gigafactory” and produce around 1 million cars per year. Experts believe Tesla will share more about its plans in an investor call on Wednesday.