DeepSeek's AI should be a 'wakeup call' to US industry: Donald Trump sounds alarm over Chinese rival

US President Donald Trump on Monday described the emergence of China’s low-cost AI model, DeepSeek, as a "wake-up call" for American industries, following a sharp selloff in US tech stocks. Speaking at a Republican congressional retreat in Miami, Trump said the launch of

DeepSeek

highlighted the need for the United States to refocus on competing in the rapidly evolving AI sector.
'Wake-up call'
"Hopefully, the release of DeepSeek AI from a Chinese company should be a wake-up call for our industries that we need to be laser-focused on competing to win," Trump said, emphasising the urgency for innovation.
Despite the disruption, Trump suggested the shockwave created by DeepSeek could push Silicon Valley to innovate more efficiently. "I would say that could be a positive," he noted. "Instead of spending billions and billions, you'll spend less, and you'll come up with hopefully the same solution."

Nvidia loses nearly $600 bn
The president's remarks come after Nvidia, the US chipmaker that dominates the AI semiconductor market, lost nearly $600 billion in market value, leading a broader rout in tech stocks. Nvidia's fall highlights the growing pressure on American firms to compete with the cost-effective advancements coming from Chinese startups.
US vs China in AI
DeepSeek, developed by a startup based in Hangzhou, has reportedly matched the performance of leading US AI models at a fraction of the investment. Its release underscores China's increasing competitiveness in artificial intelligence, a field historically dominated by the United States.
Last week, following his second-term inauguration, Trump unveiled a $500 billion initiative to bolster AI infrastructure in the United States. The venture, led by Japanese tech giant SoftBank and OpenAI, the company behind ChatGPT, aims to strengthen America's position in the global AI race.
The president's comments reflect growing concerns about the implications of China's advancements in AI technology. While the United States has long been the leader in AI development, DeepSeek's success has amplified fears about losing that edge.
The debut of DeepSeek adds another layer to the intensifying competition between the US and China in technology, particularly in AI, where breakthroughs have the potential to reshape industries, economies, and even national security strategies.