Nexperia: New crisis looming for Europe's carmakers
FRANKFURT
European automakers already buffeted by U.S. tariffs and a rocky shift toward electric vehicles now face a new threat: a shortage of key semiconductors supplied by Chinese-owned Nexperia.
Beijing is locked in a standoff with Dutch officials who invoked a Cold War-era law in September to effectively take over the company, whose factories are in Europe.
Carmakers as well as parts suppliers have already warned of shortages that would force stoppages at production lines across the Continent.
The company produces relatively simple technologies such as diodes, voltage regulators and transistors that are nonetheless crucial, as vehicles increasingly rely on electronics.
It makes them in Europe before sending them to China for finishing, and are then re-exported back to European clients.
Based in the Netherlands and once part of electronics giant Philips, it was bought by Wingtech Technology of China in 2018.
But in September, the Dutch government took the unusual step of taking over the company, citing its "Goods Availability Law" of 1952 to ensure essential items.
In response, China banned any re-exports of Nexperia chips to Europe, igniting fresh geopolitical tensions.
Nexperia supplies 49 percent of the electronic components used in the European automotive industry, according to German financial daily Handelsblatt.
The European auto lobby ACEA warned this month that production would be seriously hit.
"Without these chips, European automotive suppliers cannot build the parts and components needed to supply vehicle manufacturers and this therefore threatens production stoppages," the group said.
For Germany alone, analysts at Deutsche Bank forecast a production drop of 10 percent while warning of a 30-percent cut in a "worst-case scenario".
