Nexperia's Chip Supplies Halted Amid Threat to Global Car Production
The Netherlands-based chipmaker Nexperia, at the center of a bitter dispute with China, has suspended supplies to its Chinese factory, sending shockwaves through the global automotive industry. The move is part of an escalating trade war that threatens to disrupt production lines at carmakers worldwide.
Nexperia's decision comes after the Dutch government took control of the company in September, citing concerns over its Chinese owner Wingtech Technologies' plans to transfer intellectual property to another company it owned. The Netherlands cited this as a threat to European chip capacity and removed Wingtech chairman Zhang Xuezheng as chief executive.
In response, China halted exports from all Nexperia's factories in China, prompting warnings that production lines at EU car factories would be forced to close within days. An extended blockade is now looming over the supply chain, as many Nexperia products manufactured in Europe are shipped to China for packaging and distribution.
Nexperia's interim chief executive Stefan Tilger attributed the halt to a failure by local management to meet agreed payment terms, but acknowledged that resuming shipments would depend on this being rectified. The company plans to continue shipping products to its Malaysian factory, which is smaller than its Chinese plant.
The automotive industry has already warned of disruptions due to shortages of critical components made by Nexperia, including power control chips used in everything from airbags and adjustable seats to wing mirrors and central locking systems. Nissan said it had enough chips to last until November, while Honda suspended production at a Mexican plant. Mercedes-Benz is seeking alternatives.
However, Toyota, the world's largest carmaker, downplayed concerns, stating that it was not facing a major supply issue. The EU is now seeking further discussions with Chinese counterparts after officials met in Brussels to address China's ban on Nexperia exports and restrictions on rare earth mineral supplies.
The bloc's tech commissioner Henna Virkkunen highlighted the need for a new Chips Act, citing lessons from the current crisis, including better visibility of chip stocks, investment in supply despite cost, and reserve stocks. "Stockpiling and diversification of supply are critical for our collective resilience," she said.
Industry experts fear significant production restrictions or even stoppages if the Nexperia situation cannot be resolved soon. British operations may also be affected, with Nexperia producing some chip wafers in Manchester under a factory originally set up by Philips.
The Netherlands-based chipmaker Nexperia, at the center of a bitter dispute with China, has suspended supplies to its Chinese factory, sending shockwaves through the global automotive industry. The move is part of an escalating trade war that threatens to disrupt production lines at carmakers worldwide.
Nexperia's decision comes after the Dutch government took control of the company in September, citing concerns over its Chinese owner Wingtech Technologies' plans to transfer intellectual property to another company it owned. The Netherlands cited this as a threat to European chip capacity and removed Wingtech chairman Zhang Xuezheng as chief executive.
In response, China halted exports from all Nexperia's factories in China, prompting warnings that production lines at EU car factories would be forced to close within days. An extended blockade is now looming over the supply chain, as many Nexperia products manufactured in Europe are shipped to China for packaging and distribution.
Nexperia's interim chief executive Stefan Tilger attributed the halt to a failure by local management to meet agreed payment terms, but acknowledged that resuming shipments would depend on this being rectified. The company plans to continue shipping products to its Malaysian factory, which is smaller than its Chinese plant.
The automotive industry has already warned of disruptions due to shortages of critical components made by Nexperia, including power control chips used in everything from airbags and adjustable seats to wing mirrors and central locking systems. Nissan said it had enough chips to last until November, while Honda suspended production at a Mexican plant. Mercedes-Benz is seeking alternatives.
However, Toyota, the world's largest carmaker, downplayed concerns, stating that it was not facing a major supply issue. The EU is now seeking further discussions with Chinese counterparts after officials met in Brussels to address China's ban on Nexperia exports and restrictions on rare earth mineral supplies.
The bloc's tech commissioner Henna Virkkunen highlighted the need for a new Chips Act, citing lessons from the current crisis, including better visibility of chip stocks, investment in supply despite cost, and reserve stocks. "Stockpiling and diversification of supply are critical for our collective resilience," she said.
Industry experts fear significant production restrictions or even stoppages if the Nexperia situation cannot be resolved soon. British operations may also be affected, with Nexperia producing some chip wafers in Manchester under a factory originally set up by Philips.
! I mean, think about it, we're basically talking about the entire automotive industry grinding to a halt because of a trade dispute between two countries. And what's the trigger? A chip supplier in the Netherlands decides to pull out on its Chinese factory over some intellectual property concerns... yeah, that sounds legit 
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. I mean, can't we have a global chip market where everyone plays nice and follows the rules? It seems like this whole thing is just a big mess 
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. I'm sure it'll be super fun to watch the industry try to navigate all these new regulations and whatnot... 
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this trade war is just getting out of hand... like what's next? Nexperia's suspension is gonna have major ripples across the global auto industry and I'm already seeing production lines gettin cancelled or delayed 
. The EU really needs to sort out its chip supply chain ASAP, can't keep relying on imports from China 
... we need that tech to stay ahead in the game! Mercedes-Benz better be doin some serious shopping around for alternatives 'cause this ain't good 
. Toyota's optimism is cute but I'm not buyin it 
, and what about British operations?! How's that factory in Manchester gonna survive? 
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, especially with toyota saying they're not facing major issues 
? we need to talk about this as an industry, not just the big players, how can we ensure there are more diverse suppliers so we're not so reliant on any one company 
? and what about those reserve stocks 
, is that even feasible for everyone? 
- the eu might finally get its act together and push for that chips act they've been talking about 
meanwhile, toyota is like "no big deal" 
and nissan is like "i've got this" 
let's see how long that lasts 
the bigger issue here is why did nexperia's chinese owner wingtech do what they did? was it really about transferring ip or was there more to it? 
This is what happens when you mess with global supply chains... Nexperia's move is just the beginning of a domino effect that'll have carmakers scrambling to find alternatives or risk shutting down production 
just found out that Nexperia's chip supplies are halted and it's causing major problems for car manufacturers worldwide 
. We need to talk about diversifying chip supplies ASAP, stockpiling them, making sure there's some kind of reserve system in place. It's crazy how one company can cause so much disruption 
and it's not just nexperia, the whole global automotive industry is gonna suffer 
or else carmakers are gonna be stuck with nothing 
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this is getting crazy! 
...fingers crossed they can make some progress soon 
Nexperia just suspended supplies to China and now all the major car brands are freaking out because they're not getting those power control chips