The fallout over chipmaker Nexperia is worsening, with Nissan now warning that it’s facing a dire supply situation—one some in the industry are comparing to the COVID-era chip shortage.
The details: The tug-of-war between China and the Netherlands over the Dutch company has automakers scrambling to find alternative chip suppliers as the threat of production halts at auto plants deepens, reports Reuters.
Nissan and Mercedes-Benz have intensified their search for other suppliers, with Nissan indicating that it only has enough chips to last until the first week of November.
Honda suspended production at one of its facilities in Mexico on Tuesday and has begun adjusting production at plants in the U.S. and Canada as well.
GM and EV-maker Lucid said they are closely monitoring the situation, with Lucid confirming it has also started sourcing from alternative suppliers.
What they’re saying: “It's a big issue," Nissan's Chief Performance Officer Guillaume Cartier told reporters at the Japan Mobility Show in Tokyo on Wednesday, per Reuters. “For the moment we don't have full visibility.”
Guillaume Cartier
Why it matters: The Nexperia crisis (caught between Chinese ownership and Western trade oversight) is rippling through the global auto industry, threatening to choke off chip supplies essential for car production. If the disruption persists, vehicle inventories at dealerships could tighten sharply in the coming weeks.
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Between the lines: The worsening shortage—which began when Beijing banned exports of Nexperia’s products from China after the Dutch government seized control of the company last month—underscores how geopolitical tensions are destabilizing global manufacturing.
The Dutch government’s takeover stemmed from concerns about the transfer of technology to Nexperia’s Chinese parent, Wingtech, which U.S. officials have flagged as a potential national security risk.
Ongoing trade talks between the U.S. and China could prove pivotal in addressing the chip shortage, given its worldwide economic implications.
What they’re saying: “De-escalating the trade war, and perhaps even more important, the tech war, is of huge importance for the world economy, which got terribly hit by the shocks and the uncertainty triggered by the US president after April 2,” Rolf J. Langhammer, a researcher at the Kiel Institute for the World Economy in Germany, told Al Jazeera.
Rolf J. Langhammer
Bottom line: The Nexperia dispute has a growing number of automakers bracing for potential production slowdowns and shutdowns—and unless trade tensions ease soon, the industry could face another wave of shortages just as it begins to recover from the last chip crisis.
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