Buying data storage components from YMTC is labeled as “playing with fire.”
Republican senators have told Apple (NASDAQ:AAPL) that if the tech giant purchases memory chips from Yangtze Memory Technologies for the iPhone, Congress will scrutinize it more closely. This was captured in the Financial Times.
Playing With Fire?
According to the news source, when they heard media reports that Apple (AAPL) was considering the Chinese semiconductor company, Senator Marco Rubio, the vice chair of the Senate intelligence committee, and Representative Michael McCaul, a Texas lawmaker on the foreign affairs committee, were taken aback.
Seeking Alpha wrote at the time that such a partnership would face criticism because of the Chinese company’s ties to the Beijing government.
In an interview with the FT, Rubio stated, “Apple is playing with fire. It recognizes the security concerns posed by YMTC. If it proceeds, the federal government will scrutinize it in a way that has never been done before. We cannot allow Communist Party-affiliated Chinese enterprises access to our telecom networks or the millions of iPhones used by Americans.”
A query for comment from Seeking Alpha went unanswered by Apple (NASDAQ:AAPL). Apple informed the Financial Times that Yangtze Memory Technologies’ chips are not utilized in any of its products, but that it was “considering sourcing from YMTC for NAND chips to be used in some iPhones sold in China.”
The 60-year-old lawmaker added that Yangtze Memory Technologies is breaking export control laws by selling to Huawei, which has been severely restricted by both President Trump and President Biden from doing business in the U.S. due to national security concerns. McCaul expanded on Rubio’s remarks, saying that Yangtze Memory Technologies has “extensive” ties to the Chinese Communist Party and military.
The FT further reported, citing sources with knowledge of the situation, that a number of additional US politicians had voiced their concerns regarding Yangtze Memory Technologies to the US Commerce Department and Secretary Gina Raimondo.
According to Gene Munster of Loup Ventures, Apple’s (NASDAQ:AAPL) choice to maintain the same price for the iPhone 14 will help the tech company gain market share. On Thursday, Apple’s stock underperformed when compared to its main rival stocks.
Featured Image- Megapixl @Andreistanescu