Lutnick Stalled Trump’s Crackdown on Nvidia Chip Diversions to China, Axios Reports
President Donald Trump approved action against companies suspected of diverting Nvidia's advanced AI chips to China three times this year, but Commerce Secretary Howard Lutnick repeatedly held it up, according to Axios. The controls still have not taken effect.
WASHINGTON — President Donald Trump approved a crackdown on companies suspected of diverting Nvidia’s advanced artificial intelligence chips to China three times this year, but Commerce Secretary Howard Lutnick repeatedly stood in the way, Axios reported on Wednesday.
Trump gave the go-ahead a third time on Thursday of last week, after consulting billionaire Elon Musk, according to the report, which cited high-level sources. He had approved the same step in May and again in August. The restrictions still have not been put in place.
The dispute came into the open at a White House Situation Room meeting on November 5. Lutnick met there with Treasury Secretary Scott Bessent, Defense Secretary Pete Hegseth, Trade Representative Jamieson Greer and Secretary of State Marco Rubio. During the meeting, Bessent confronted Lutnick about his department’s resistance to carrying out export controls, Axios reported. Lutnick appeared to agree but said he needed to check with Trump, according to the report.
Axios reported that Lutnick and Commerce Undersecretary Jeffrey Kessler pushed back against pressure from Bessent and others to move forward. Kessler oversees the Bureau of Industry and Security, the Commerce unit that licenses chip exports and polices diversion.
A blacklist with no new names
The Commerce Department has not added a single company to its Entity List, the trade blacklist for firms seen as national security risks, since October 2025, Reuters reported. That is the longest stretch without a new listing in more than a decade.
In June, Reuters reported that the administration had held off from adding China’s AI startup DeepSeek, memory chipmaker CXMT and more than 100 other companies flagged as national security risks to the list.
Several lawmakers have said in recent days that they want the administration to take a tougher line on chip exports to China and have called on Congress to approve legislation that would tighten the restrictions. Their push followed disclosures about Nvidia chief executive Jensen Huang. Nvidia’s board opened an investigation after reports that Huang had a close relationship with a Chinese businesswoman whom U.S. intelligence officials believed was spying for Beijing. Huang resigned as Nvidia chief executive on Thursday, and the company named chief financial officer Colette Kress interim chief.
The White House and a spokesperson for Lutnick did not immediately respond to a request for comment, Reuters reported.
Reporting based on coverage by Axios and Reuters.
