Nexperia Warns of China chip risks; German auto industry responds
Nexperia has cautioned customers that it cannot guarantee the authenticity or quality of chips manufactured in China since October 13, Reuters reports. The Dutch semiconductor company said operations in its factories outside China remain unaffected.
As previously reported, the Dutch government assumed temporary control of Nexperia on September 30, while Chinese authorities responded by blocking exports of its products beginning October 4. The resulting disruption has contributed to shortages of Nexperia components widely used by global automotive manufacturers.
Reuters notes that Nexperia expects the situation to be resolved, but the company has formally advised customers about risks related to products produced in China during the export restrictions.
In statements cited by Reuters, Nexperia welcomed confirmation that it will not be subject to US export restrictions for the next year under a recently announced US–China agreement. China has also indicated it may approve exports on a case-by-case basis. As previously reported, Wingtech, Nexperia’s Chinese parent company, is subject to US trade controls.
While the majority of Nexperia’s chip production takes place in Europe, approximately 70% of these European-manufactured chips are packaged in China before being distributed. The company’s Chinese subsidiary has argued that it is operating independently from Dutch oversight and has sufficient inventory to continue supplying customers through late 2025, while exploring alternative sourcing.
“We remain fully committed to our operations in China,” the company said, according to Reuters. Nexperia added that it is working on additional measures to secure long-term product availability. The remaining 30% of its packaging and distribution currently takes place in Malaysia and the Philippines.
VDA responds to Nexperia shortages
The German Association of the Automotive Industry (VDA) says that it plans to establish a temporary information platform in response to a potential supply disruption of Nexperia products.
VDA President Hildegard Müller confirmed that on October 9, Nexperia informed manufacturers and suppliers that it could no longer fully guarantee the supply of its microchips. Components that are critical for vehicle electronic systems.
The VDA aims to coordinate the use of existing Nexperia stocks to sustain production and prevent shutdowns. The proposed platform, run by a neutral third party, will allow companies to exchange information on available microchip capacities while complying with antitrust regulations.
The Federal Cartel Office has reviewed the project and expressed no fundamental antitrust concerns.
