Officials at Nexperia in the Netherlands have welcomed recent statements from both the United States and China indicating that barriers preventing the company from shipping its chips may soon be lifted. On Sunday, the company emphasized that its “focus is now on ensuring stability of supply to customers,” according to statements shared with reporters.
Nexperia did not comment on remarks made by its Chinese subsidiary, which expressed intentions to accelerate steps toward greater operational independence. Meanwhile, Dutch officials reported ongoing talks with their Chinese counterparts, the U.S. government, and representatives from the automotive and semiconductor sectors to find what they described as a “constructive way forward.”
### Global Auto Industry Impacted by Supply Disruptions
The dispute over control of Nexperia has already caused chip shortages and raised alarms across the global automotive industry. Automakers worldwide rely heavily on Nexperia for large volumes of basic semiconductor components used in nearly every car model on the road today.
These components, while small and inexpensive, play crucial roles—they connect batteries to motors, operate sensors, manage braking systems, control airbags, power entertainment screens, and run electric windows. The disruption in supply has led automakers to warn of potential production cuts if the situation continues.
### Ownership and National Security Concerns
Nexperia is owned by the Chinese company Wingtech. In October, the Dutch government took control of the chipmaker under a national security law dating back to the Cold War era, citing concerns that Wingtech planned to transfer intellectual property to another business it controls.
During this period, a Dutch court also suspended Nexperia CEO Zhang Xuezhen on grounds of mismanagement, adding another layer of tension to the dispute. In response, China blocked Nexperia chips made or processed in China from leaving the country. Since around 70% of Nexperia’s chips begin production in Europe but are assembled and tested in China before being shipped to automakers worldwide, this move severely impacted the supply chain.
With shipments halted, Nexperia informed car manufacturers that it could no longer guarantee the supply of chips. Meanwhile, Western governments have intensified scrutiny of companies linked to Chinese technology networks. In December 2024, the United States blacklisted Wingtech, accusing the company of aiding China’s government efforts to acquire entities with sensitive semiconductor manufacturing capabilities. This blacklist restricted Wingtech’s access to American technology and heightened diplomatic tensions around Nexperia.
### Signs of Progress Amid Continued Risks
Efforts to ease tensions continued with meetings held on Saturday in Europe. Reports on Friday indicated that the United States plans to permit Nexperia to resume exports under a framework developed during discussions between then-President Donald Trump and President Xi Jinping.
On Saturday, Chinese officials announced they would exempt certain Nexperia products from export controls. The Chinese Commerce Ministry stated it would “comprehensively consider the actual situation of the enterprise and exempt eligible exports,” though it did not specify which products would qualify.
Automakers including Volkswagen, Nissan, and Mercedes-Benz had already warned in late October that ongoing supply disruptions could force production reductions. While carmakers typically maintain small chip reserves and can sometimes pivot to backup suppliers, they emphasized the difficulty of switching quickly because these chips are deeply integrated into vehicle engineering and safety systems.
### Nexperia’s Market Role and Future Outlook
Nexperia reported $2 billion in sales last year. The company manufactures billions of foundational chips that power not only automobiles but everyday electronics in general. Essentially, these components are present anywhere electricity flows.
If the exemptions and export framework are finalized, they could help ease the immediate pressure on automakers. However, the broader dispute over who controls Nexperia, technology governance, and security oversight remains unresolved.
The negotiations are ongoing, and the supply chain continues to be fragile.
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