Nexperia Crisis: New Warning of Production Stoppages, Unusual Countermeasures
The crisis surrounding chip manufacturer Nexperia is likely not over yet, and there are unusual attempts in the industry to prevent supply bottlenecks.
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A week after the crisis surrounding the products of semiconductor manufacturer Nexperia seemed to come to an end, there are new warnings of a “devastating” chip shortage, production stoppages, and reports of unusual attempts to prevent it. The dramatic warnings from the automotive industry were made public by the Financial Times this week. Reuters now reports that some European companies are buying wafers from Nexperia in Europe and bringing them directly to China, where they are also to be processed by Nexperia. This is not a long-term solution, but an attempt to prevent short-term bottlenecks.
No end to the crisis in sight
The reports indicate a new phase in the consequential dispute over Nexperia. The problems with the chip manufacturer began when the Dutch government took control of the company, which is led by a Chinese parent company and based in Nijmegen. The application of a rarely used law was intended to prevent the migration of technological knowledge and intellectual property. The People's Republic reacted sharply and stopped the export of Nexperia products from China, which are not easily replaceable, among other things, in the automotive industry. Nexperia produces wafers in Germany, among other places, which are then further processed in China. These shipments from Europe to the People's Republic have come to a standstill in the course of the dispute.
Last week, a solution actually seemed to be announced because the Dutch government was reportedly prepared to give up control over Nexperia. In return, China would have to allow the export of Nexperia products again, it was said at the time. This was announced in the course of the trade agreement between China and the USA. According to the Financial Times, deliveries have actually resumed since then, but apparently not enough. The newspaper quotes assessments from the automotive industry according to which the situation remains “very challenging.” Production stoppages are therefore not off the table and could become necessary within weeks. Nexperia from the Netherlands and Nexperia from China must finally agree, demanded an anonymous industry representative.
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Others, however, have meanwhile begun to treat the two company parts as individual companies, Reuters now reports, citing equally anonymous sources. According to this, the first companies from Europe have started to buy wafers directly from the Hamburg plant of the Dutch part of Nexperia and have them delivered themselves to the plant of the Chinese part. There they would then be further processed. The news agency does not state which companies these are. In Nijmegen, meanwhile, they are already looking for plants in Malaysia and the Philippines that could replace the one in China, Reuters adds. Nexperia itself has not commented on this procedure. It is only feasible for large corporations at all.
(mho)
