Disruptions at Nexperia are rippling through the global auto chip supply chain, as tensions between its Chinese and Dutch units deepen. According to Reuters, Nexperia’s China unit said it had established “sufficient inventories of finished goods and work-in-progress” after the Dutch company suspended wafer supplies to its Chinese assembly plant on October 26.

As noted by South China Morning Post, Nexperia China sought to reassure customers that its production remains unaffected, saying it has secured new wafer suppliers and can continue meeting client demand through the end of the year and beyond.

Last week, Nexperia Netherlands halted wafer shipments to its assembly and testing plant in Dongguan — a southern Chinese manufacturing hub that accounts for about 70% of the company’s global output, citing the local unit’s “failure to meet agreed contractual payment terms,” according to South China Morning Post.

In response to the allegation from Nexperia Netherlands, Nexperia China called the accusation a malicious smear against its management. The Chinese unit emphasized that it had not breached any contracts; rather, Nexperia Netherlands currently owes ATGD, the company’s assembly and testing plant in Guangdong, payments totaling 1 billion yuan (US$140 million), according to ijiwei.

The company’s situation is also being influenced by the outcome of the Xi–Trump summit. As reported by The Wall Street Journal, China’s Commerce Ministry announced plans to ease export restrictions on semiconductors produced by Nexperia. The White House detailed the policy change in a fact sheet released on Saturday, noting that China will take steps to ensure the resumption of exports from Nexperia’s Chinese facilities, enabling the continued global supply of critical legacy chips.

Meanwhile, Wingtech, the Chinese parent of Nexperia, has appointed veteran general counsel Sophie Shen Xinjia, a Columbia Law School graduate, as its new president amid the ongoing Sino-Dutch dispute over control of the Netherlands-based chipmaker. As noted by South China Morning Post, Shen’s appointment highlights Wingtech’s effort to navigate the legal and regulatory challenges surrounding Nexperia, which has been placed under Dutch government control.

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(Photo credit: Nexperia)