A cybersecurity policy organization led by CrowdStrike co-founder Dmitri Alperovitch is calling for import taxes on digital display components to reduce America’s military dependence on Chinese suppliers for these essential parts.
The Silverado Policy Accelerator released findings Thursday warning that China’s growing dominance in the display manufacturing sector poses serious national security concerns. Defense officials have expressed worry for years about China’s expanding control over display technology, which was previously dominated by American allies like Japan and South Korea.
In 2023, former President Trump enacted legislation requiring the Defense Department to develop a strategy by 2027 to eliminate dependence on China, Russia, and other adversaries for critical technologies.
The policy group’s research examined the supply chain beyond finished displays to focus on individual “cells” – semiconductor-like components that serve as the foundation for display panels. Their investigation revealed that most displays manufactured in nations like Mexico or Thailand depend on cells produced in China.
While premium smartphones sold in America currently utilize Korean-manufactured cells, the report projects that lower-cost Chinese cells could capture up to 75% of worldwide market share by 2028. This trend is already forcing manufacturing facilities in Japan and Taiwan to shut down.
“When we started looking at this, what we saw was another dashboard of flashing red emergency lights,” said Sarah Stewart, a former U.S. trade official who is CEO and executive director of the policy group. “We’ve seen this before in other sectors. We have really dangerous exposure here on some of these critical components that are powering our military, first responders, power plants and literally every piece of critical infrastructure.”
Although courts have overturned many of Trump’s broad-based tariffs, his administration continues developing focused tariffs under specific legal authorities.
The organization’s report suggests that display cells could fall under an existing “Section 301” investigation into unfair trade practices, potentially allowing tariffs on Chinese-made display cells in finished products.
“It gives a lot of flexibility to the executive branch to think about burden or restriction on U.S. commerce in quite a broad way,” Stewart said of the statute.
