China has announced the removal of export controls on essential computer chips used in automobile production, as stated by the country’s commerce ministry. This change includes exemptions for exports from Chinese-owned Nexperia, which are intended for civilian use. The decision aims to assist car manufacturers who were concerned about potential production disruptions in Europe.
In a related context, the Dutch government previously took control of Nexperia, which is headquartered in the Netherlands but owned by China’s Wingtech, in an effort to protect the European semiconductor supply chain for vehicles and various products. Following this action, China imposed a ban on exports of Nexperia’s finished chips. However, a recent easing of this ban correlates with a trade agreement reached between the United States and China.
Nexperia produces about 70% of its chips in Europe, with a significant portion being sent to China for finalization before re-exporting to other markets. The Dutch government cited “serious governance shortcomings” as the reason for its intervention in Nexperia, indicating that it aimed to ensure chip availability during emergencies.
Concerns arose following China’s ban, particularly within the European Automobile Manufacturers’ Association (EMEA), which warned that the supply of Nexperia chips could be depleted within weeks. The EMEA’s director general, Sigrid De Vries, had expressed that impending supply shortages were likely. Major automakers, including Volvo Cars and Volkswagen, raised alarms about potential temporary plant shutdowns due to the chip scarcity.
Recently, EU trade commissioner Maros Sefcovic announced via social media that China had agreed to simplify export procedures for Nexperia chips and to waive licensing requirements for civilian-use exports. The commerce ministry of China called for the EU to encourage the Netherlands to reconsider its previous actions regarding Nexperia.
Source: https://www.bbc.com/news/articles/c0rp2514g4qo?at_medium=RSS&at_campaign=rss