Semiconductor supply chain disruption
Nexperia issues open letter urging “open dialogue” with China unit as customers report imminent production stoppages
Chipmaker Nexperia has issued an open letter to the leadership of its entities in China in an attempt to establish direct communication to resolve an ongoing dispute that is threatening automotive production.
Nexperia's leadership in the Netherlands and China have been engaged in a disruptive dispute since October
Nexperia
On November 27, the company’s Dutch leadership published the
letter, pleading for an open dialogue with its unit in China in order to find a
path forward to restoring the regular supply of goods.
The Nexperia saga so far:
This is the latest update in an ongoing saga that has seen
the semiconductor supply chain disrupted since the
Dutch government seized Nexperia in October. It follows the Dutch minister
of economic affairs Vincent Karremans’ announcement on November 20 that he has suspended
the order under the Goods Availability Act in which it seized control of the
chipmaker, in an attempt to resolve the crisis and resume the regular flow of
Nexperia chips from China.
Nexperia’s headquarters in the Netherlands has said it has “made
repeated and multiple attempts, both formal and informal, to re-establish the
dialogue” with its entities in China, but “did not receive any meaningful
response”.
“We welcomed the Chinese
authorities’ commitment to facilitate the resumption of exports from Nexperia’s
Chinese facility and that of our subcontractors, enabling the continued
flow of our products to global markets,” Nexperia said in the statement. “Nevertheless,
customers across industries are still reporting imminent production stoppages.”
Several OEMs have warned of the impact of this disruption on
their supply chains. Honda,
for example, has had to halt operations at its plant in Celaya, Mexico and make
adjustments to production in Canada and the US.
In its H1 2025 financial results, Honda forecast a reduction
of 110,000 units and a total cost of around ¥150 billion ($969 million) as a
result of the crisis.
Meanwhile, Nissan told Reuters on November 18 that it
will cut production by another 1,400 vehicles at its plant in Kyushu, Japan, as
the fallout from semiconductor supply disruptions linked to Nexperia continues
to affect its operations. This followed a reduction in vehicle output by 900
units the previous week.
And it’s not just OEMs that have been affected. A
spokesperson for tier one supplier Bosch told Reuters on October 24: “We
are currently doing everything we can to serve our customers and avoid or
minimise production restrictions. We have not yet made any adjustments to
working hours at our German locations, but are preparing to do so, particularly
in Salzgitter.”
News outlets in Germany later reported that, in early
November, Bosch reduced working hours at its facilities in Ansbach and
Salzgitter. On November 24, reports in Portugal claimed that Bosch’s factory in
Braga has been able to resume after it was placed on lay-off in late October
due to component shortages, while production disruptions and temporary
adjustments to working hours continue at Bosch’s Ansbach and Salzgitter sites.
“This situation cannot persist,” Nexperia asserted. It has urged
the leadership of its entities in China to “take immediate steps toward
structured negotiations to… restore predictable, established supply flows
without delay”.
