Nexperia, a semiconductor manufacturer based in the EU, has halted supplies to its Chinese factory, intensifying ongoing trade tensions that could disrupt global automotive production. This suspension was communicated to customers recently, indicating a significant shift in operational dynamics.
The move follows the Dutch government’s intervention in September, which invoked national security laws to seize control of Nexperia from its Chinese owner, Wingtech Technologies. Authorities expressed concerns that Wingtech might relocate intellectual property. As a result of these actions, the Dutch government removed Zhang Xuezheng, the chairman of Wingtech, from his role as Nexperia’s CEO.
In retaliation, China has barred exports from Nexperia’s factories within its borders, raising alarms that this embargo could lead to production shutdowns in European car manufacturing within days. Nexperia’s products, including chip wafers from Europe, had previously been sent to the Chinese facility for final packaging and distribution.
Stefan Tilger, Nexperia’s interim CEO, cited a failure to adhere to contractual payment terms as the reason for the suspension of shipments to the Dongguan facility. The company remains optimistic about resuming supplies if payment conditions are met and indicated it will continue operations at a smaller facility in Malaysia.
Various automotive manufacturers have reported potential disruptions due to the shortage of Nexperia’s components, which are essential in numerous vehicle functions. While some companies like Nissan claim to have sufficient supplies for the short term, others, like Honda, have already suspended production at certain sites.
European officials, including trade commissioner Maroš Šefčovič, are seeking further talks with Chinese representatives regarding the situation. Meanwhile, Nexperia continues to engage with EU tech regulators to address these pressing challenges in the semiconductor supply chain, emphasizing the need for improved visibility and stockpiling measures in response to current crises. The impact of this trade dispute extends beyond China, as British operations, including a chip wafer manufacturing site in Manchester, may also be affected.
Source: https://www.theguardian.com/business/2025/oct/31/nexperia-halts-chip-supples-china-threat-car-production