The United States has been continuously intervening in the chip industry, imposing restrictions on one hand and attracting investment through massive subsidies on the other.

However, unexpectedly, a series of maneuvers have led to a decline in performance for many chip giants.

A few days ago, another global chip giant announced its performance report for the first quarter of this year, revealing its first quarterly loss since 2009, with a staggering 96% drop in performance.

In 2022, inflation intensified, and the demand for tech equipment was sluggish, a situation that occurred among consumers worldwide.

Many semiconductor clients have been reducing their purchases of new chips, consuming existing chip inventories, and as a result, new chips are not selling, causing chip prices to plummet.

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Samsung, a global chip giant that had not experienced a loss for over a decade, saw its losses exceed 40 trillion won in the latest quarter.

Consequently, Samsung had no choice but to change its strategy and take the first step in reducing production.

However, this was not enough; under duress, the giant decided to withstand pressure from the United States and swiftly signed a contract with China, hoping to regain its position in the Chinese market with large orders.

On April 6th, Wantai Technology announced that it had secured a large ODM order from Samsung, which should be the stepping stone for Samsung's return to the Chinese market after its products faded away.

Compared to other popular electronic product chains, Samsung's supply chain development in China is not stable, the scale is much smaller, and its influence is far from what it used to be.

This contract with Wantai Technology is also a readjustment of Samsung's supply chain in China.

However, Samsung has not provided sufficient supplies to domestic suppliers for many years, and regaining market share is not that simple.

It needs to build its supply chain through ODM orders and compete with other mobile phone manufacturers.

The road back to China is full of challenges laid out by other popular brands.

Previously, Samsung's withdrawal from the Chinese market was largely due to pressure from the United States, following the footsteps of Apple.

By 2020, the production capacity of Airpods had been transferred to Vietnam; Foxconn launched the latest iPhone 13 series in Chennai, India, in April 2022; iPads, Macs, watches, and other devices will also be gradually transferred to Vietnam.

Moreover, since 2018, to avoid tariffs on China, Apple has asked its suppliers to transfer some of their production capacity from China to Southeast Asia.

Among Chinese Apple chain companies, some, led by Foxconn, have set up factories in Southeast Asian countries such as Singapore and Thailand.

However, after two years of development, both Samsung and Apple have realized that in the next 4 to 5 years, the production efficiency of Southeast Asia will be lower than that of factories in China.

Moreover, the number of factories in Southeast Asia cannot be compared with those in China.

Foxconn in Zhengzhou is the largest factory of Apple in the world, with 300,000 employees, as large as a small city.

In contrast, the 31 enterprises in Vietnam only have a total of 160,000 employees.

What to do?

On one side, there is a sharp drop in performance that requires self-help, and on the other side, there is pressure from the United States.

Samsung finally decided to return to China, and this time the large order for Chinese manufacturing is obviously taking advantage of the opportunity when the U.S. economic crisis is brewing and has no time to care.

The biggest problem the United States is facing now is that the status of the dollar may not be guaranteed.

Currently, countries around the world, including Israel, are adjusting their foreign exchange reserve structure, reducing the proportion of dollars and euros, and increasing investment in currencies such as the renminbi.

In addition, many non-traditional reserve currencies have the characteristics of high returns and low risks, which are also more likely to attract investment from central banks of various countries, thus reducing the demand for the dollar.

Countries are continuously reducing their holdings of dollar assets, and in the future, trade will not need to use the dollar as an intermediary currency for conversion, which can reduce the dependence of various countries on the dollar and promote the multipolar development of international currencies.

The dollar is now seen as a currency with great future economic risks by many countries, and the high risk has reduced the share of dollar foreign exchange reserves.

Economically stable and low-risk currency types will replace the dollar as the future investment direction.

So in this situation, maintaining the status of the dollar has become the most important task for the United States.

As for the restrictions on chip giants, they are overlooked.

Perhaps Samsung is taking advantage of this opportunity to return to China.