Trump Calls China's DeepSeek AI a 'Wake Up Call' for US Industry

Trump urges US companies to focus on innovation following the emergence of DeepSeek AI, a low-cost Chinese AI model that has disrupted tech markets.

US President Donald Trump described the release of DeepSeek AI, a new artificial intelligence model developed by a Chinese startup, as a 'wake up call' for American industries.

Speaking at a Republican congressional retreat in Miami on Monday, Trump stressed the importance of the US focusing on competition in the AI sector.

He highlighted that the emergence of DeepSeek, which has reportedly demonstrated similar capabilities to US AI leaders at a fraction of the investment, should encourage American companies to be more innovative and cost-effective.

Trump suggested that the development of the low-cost AI model could prove beneficial for Silicon Valley, as it might push companies to innovate more efficiently, potentially leading to lower costs and maintaining similar technological advancements.

The president's comments follow a significant drop in tech stock values, including a nearly $600 billion loss in market value for US chip-maker Nvidia, a key supplier of semiconductors to the AI industry.

DeepSeek was created by a startup based in Hangzhou, China, and has reportedly gained attention for its ability to rival the performance of US AI models despite far lower investment.

Trump’s remarks come just days after his inauguration for a second term, during which he announced a $500 billion initiative to enhance AI infrastructure in the United States.

This initiative will be led by Japanese tech giant SoftBank and OpenAI, the creator of the popular chatbot ChatGPT.