This photograph shows a general view of Nexperia headquarters in Nijmegen on November 6, 2025.
John Thys | Afp | Getty Images
Dutch chip manufacturer Nexperia has issued a public plea to its China unit urging immediate action to revive supply chain operations. The company cautioned in an open letter that numerous customers across various industries are facing “imminent production outages.”
The letter from Nexperia’s Dutch headquarters came after multiple attempts to reach out through normal communication channels resulted in no significant response. This turn of events underscores the ongoing challenges faced in the semiconductor industry, which have grave implications not only for technology production but also for broader sectors, particularly the automotive industry.
This latest communication is part of a protracted issue that has plagued global automotive supply chains and has fueled a complex conflict between Amsterdam and Beijing concerning technology transfer and corporate governance.
Nexperia’s Dutch leadership noted their appreciation for the Chinese authorities’ commitment to facilitate resumed exports from Nexperia’s facility, but they reiterated an urgent need for quick action to prevent catastrophic production halts claiming, “This situation cannot persist,” emphasizing the necessity of restoring established supply flows.
In contrast, Wingtech Technology, the parent company based in China, responded to the open letter by disputing its claims and labeling them as “misleading.” They pointed to what they called an “unlawful deprivation” of their control and shareholder rights as the leading cause of the supply chain crisis. Wingtech argued that the Dutch government’s interventions appear to be strategic moves aimed at altering Nexperia’s control structure, thereby disrupting supply continuity.
In this photo illustration, the logo of semiconductor manufacturer Nexperia is displayed on a screen.
Vcg | Visual China Group | Getty Images
Nexperia plays a crucial role in the semiconductor ecosystem, manufacturing billions of essential chips that include transistors, diodes, and power management components. These chips, while relatively low-tech and inexpensive, are vital for nearly every electronic device and automotive function, including battery connections, braking systems, airbag controllers, and entertainment systems.
The crisis surrounding Nexperia began last September, when the Dutch government invoked a Cold War-era law to assert control over Nexperia due to U.S. security concerns. This decision prompted a retaliatory move from Beijing, which restricted the export of Nexperia’s products, intensifying shortages among automakers globally. Although the Dutch government recently suspended its intervention efforts after negotiations with Chinese officials, the situation remains precarious, depending heavily on the restoration of the corporate relationship with Wingtech and the securing of essential supplies from Europe.
What’s the Road Ahead?
As of now, prominent players in the automotive industry, including major manufacturers like Nissan, Volkswagen, and Mercedes-Benz, have flagged impending supply risks due to the ongoing uncertainty surrounding Nexperia. They voiced concerns particularly for the upcoming first quarter of 2026, indicating a challenging future for production stability.
Industry analysts suggest that the situation concerning Nexperia resembles the geopolitical tensions surrounding China’s rare earth exports, with the Chinese market retaining significant leverage due to European manufacturers’ reliance on supply. This dependency raises questions about transparency in supply qualifications and who can access the necessary chip supplies, creating a complex and competitive landscape.
The urgent need to establish a secure and reliable semiconductor supply chain is paramount for global technology and automotive sectors. As economic and political landscapes evolve, companies are left to navigate the remaining uncertainties, balancing operational needs while adhering to the changing regulatory frameworks and geopolitical pressures.
In this volatile context, one can only wonder: What strategies can companies adopt to ensure supply chain resilience? How will this situation shape the future of international business relations in the semiconductor industry? Will we see a shift in manufacturing locations as companies seek to mitigate these risks?
Editorial content by Sierra Knightley
