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Industry faces chip disruption

China’s ban on exporting Nexperia parts used in cars could impact production levels.
Posted on 23 October, 2025
Industry faces chip disruption

The automotive industry is preparing for imminent production disruption because of China’s export restrictions on semi-conductors made by Nexperia.

Shortages are likely to hit key suppliers in Europe within a week, while the impact could spread across the entire sector within 10 to 20 days.

Beijing has blocked Nexperia, a Dutch chipmaker owned by China’s Wingtech Technology Co, from exporting products made at its Chinese plants. The move came after the Dutch government seized control of the company under emergency laws meant to safeguard strategic production.

China’s Commerce Minister Wang Wentao used a call with Dutch Economic Affairs Minister Vincent Karremans on October 21 to warn the Netherlands’ move to take control of Nexperia has “seriously affected” the stability of the global supply chain.

The Dutch government says it will remain in contact with Chinese authorities to work “toward a constructive solution.”

The Nexperia chip ban has expanded a wider dispute as China and the US prepare for high-level talks later this month. It follows Beijing’s measures to tighten exports of rare earths and battery materials needed for EVs.

Carmakers and their suppliers are holding crisis meetings with government officials to map out contingency plans, but warn sourcing and qualifying replacement components will take months.

The fallout is expected to extend beyond Europe, with carmakers in the US also exposed through smaller parts and electronics makers that rely on Nexperia chips, reports Automotive News.

German chipmaker Infineon Technologies, one of the main suppliers to the motor-vehicle industry, has been fielding inquiries from manufacturers seeking alternative sources of components.

While initially caught off guard, marques and suppliers have opened channels with the Chinese authorities as well as officials in the Netherlands and the European Commission. The aim is to clarify the scope of the export controls and explore ways to ease the impact before production lines are forced to stop.

Volkswagen has set up a task force to assess potential exposure in its supply chain. Robert Bosch, the world’s largest automotive parts maker, says its teams are in contact with Nexperia and other suppliers and affected customers to avoid or minimise any production restrictions.

Mercedes-Benz says it is monitoring developments and has secured short-term supplies for the short term. The German company is working with its partners to avoid potential supply gaps, but adds it will be difficult to make reliable forecasts “due to the high degree of complexity and volatility”.

Nexperia says its facility in China’s Guangdong province, pictured above, covers about 80,000sqm and is its largest small-signal assembly site with a capacity of more than 50 billion pieces per year.