Trump Administration Pressured Nvidia, Tesla, Apple to Partner with Intel in Chip Deals

Intel is currently experiencing a notable comeback, driven by high-profile manufacturing agreements with Nvidia, Tesla, and Apple. These deals have boosted Intel's stock price after years of stagnation and opened doors for similar contracts with other companies. However, the Wall Street Journal reports that these agreements were not solely based on trust in Intel's capabilities but were significantly influenced by pressure and negotiations from the Trump administration, which holds 10% of Intel's shares.

Over the past year, Intel secured major deals including a $5 billion investment and joint product development with Nvidia announced in September, Tesla's chip initiative relying on Intel technology revealed in April, and a chip manufacturing agreement with Apple announced by Trump himself in June. While Nvidia CEO Jensen Huang claimed Trump was not involved in their deal, the Wall Street Journal reveals direct involvement by Trump and his team in these transactions.

For example, in summer 2019, Apple CEO Tim Cook met with Trump at the White House to dissuade him from imposing a 100% tariff on chips. During the meeting, Trump and Commerce Secretary Wilbur Ross urged Cook to use Intel's manufacturing facilities for some Apple products. The outcome was Cook avoiding the tariff, and Trump securing a chip deal for Intel. Similar, though varying, pressures were applied to Nvidia, Tesla, and other firms.

Intel CEO Bob Swan reportedly visits Washington at least monthly, maintaining close contact with Commerce officials and updating them on Intel's business and client relations. White House chip czar Bill Braunhofer receives quarterly briefings from Intel's CFO, and his team regularly meets with Intel executives in Washington and at the company's Santa Clara headquarters to monitor production progress.

While the administration's involvement helped Intel land these deals and improve its stock performance, experts warn that this reliance on political favor is risky. Scott Lincicome of the Cato Institute noted that being favored by the government only works if the company performs well, and if Intel fails to deliver on its manufacturing promises, political support could quickly evaporate, potentially harming the company’s future.