Following days of talks and negotiations, semiconductor maker Nexperia is now saying it has no clarity “if and when” it will resume delivering the crucial chips (or what the quality would be).
The details: As China and the Netherlands continue to battle over control of Nexperia, tensions between the two countries intensified Tuesday, reports Reuters.
China claims that the Netherlands is not cooperating with Beijing regarding the seizure of Nexperia over intellectual property concerns.
Automakers had been optimistic over the weekend that trade discussions between President Trump and Chinese President Xi Jinping would help ease China’s suspension of the exports.
What they’re saying: "We are in the process of further clarifying the scope and implications of the China action regarding Nexperia's facilities and subcontractors in China as soon as possible," according to the letter from the chipmaker to its customers, which was dated November 3 (obtained by Reuters).
Why it matters: The pause in shipment of the chips (which are needed for core vehicle functions) is already impacting production. If the ban continues, fewer units will flow to the dealer level, which could tighten inventory and complicate month-to-month availability and incentive planning.
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Between the lines: The crux of the rift over Nexperia is rooted in oversight of the chip company, with Beijing blaming the Netherlands for the holdup, while the Dutch ministry contends it is still working toward a resolution, reports Aljazeera.
The chipmaker is based in the Netherlands, but owned by China's Wingtech, which has drawn security concerns from the U.S.
Dutch officials have worried that Wingtech would move operations to China—where most of Nexperia's chips are packaged—which is what prompted the Netherlands to seize the company.
What they’re saying: “The Dutch side persists in its unilateral course without taking concrete actions to resolve the issue, which will inevitably deepen the adverse impact on the global semiconductor supply chain,” said the Chinese commerce ministry in a statement.
Bottom line: The geopolitical fight over Nexperia isn't resolving soon, and automakers can't produce around it. Dealers should expect tighter inventory flow and potential allocation adjustments as production constraints hit the pipeline.
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