Honda is preparing to resume its regular production schedule—after halting some of its manufacturing operations due to the chip disruption stemming from the tug-of-war over Nexperia.
The details: The Japanese automaker—which adjusted production during China’s ban on exports from the Dutch-owned company—signals that concerns over the impact of the geopolitical tensions tied to Nexperia could be easing, reports Reuters.
Honda’s affected facilities include its Mexico plant, where production was halted on October 28, and factories in the United States and Canada where output was adjusted.
The automaker’s tentative plan calls for returning the facilities to full operation next week—though a spokesperson warns that the plans could change if the situation shifts.
Why it matters: Honda getting back to normal is an early sign that the latest chip shock from the Nexperia dispute may be stabilizing before it turns into a full-blown repeat of the 2021 auto-chip crisis—but it also shows how fragile carmakers still are to geopolitics.
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Between the lines: The Nexperia dispute has forced Honda (and other automakers) to secure chips from alternative sources, underscoring the broader industry push to be less dependent on China for critical auto parts.
Tesla is requiring its suppliers to find other sources for components made in China for its U.S.-made cars.
GM has ramped up its supplier directive aimed at eliminating dependence on auto parts and components made in China.
Bottom line: Honda’s move to restart production suggests the immediate chip crunch from the Nexperia dispute is easing, at least for now, helping avoid a deeper hit to car inventories and prices. But the episode is accelerating a broader industry shift to reduce reliance on China by diversifying chip and parts suppliers.
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