Dutch chipmaker Nexperia’s Chinese unit announced on Sunday that it has maintained “sufficient inventories of finished goods and work-in-progress” amidst ongoing concerns over the supply of wafers due to its parent company halting shipments. This decision by Nexperia, taken on October 26, stemmed from what they described as a “failure to comply with the agreed contractual payment terms” by local management, as reported by multiple sources.
The Chinese unit responded sharply, labeling the suspension as “unilateral” and “extremely irresponsible.” They further argued that the claims regarding contractual payments were “misleading and highly deceptive,” emphasizing their right to operate independently following Dutch authorities’ intervention in September, which stripped control from its Chinese parent company, Wingtech. This move was motivated by fears of potential technology transfers, prompting Beijing to block the company’s products from leaving the country.
In light of these developments, Nexperia China has initiated several contingency measures and is expediting the qualification of new wafer supply sources. They expressed confidence in their ability to meet customer demands starting next year, asserting that their existing stocks would support order fulfillment through the end of the year and beyond.
Nexperia is known for producing essential, low-cost power-control chips, including transistors and diodes, which are integral to various electrical devices. Automakers that rely on Nexperia’s chips had also raised alarms about potential production setbacks due to this supply chain disruption.
According to recent reports, the White House is anticipated to announce a resolution allowing Nexperia’s China facilities to resume shipments, coinciding with a trade truce reported at a summit between U.S. President Trump and Chinese President Xi Jinping. Additionally, China’s Ministry of Commerce indicated that it would consider exemptions for Nexperia’s chip exports from China, signaling a potential easing of tensions surrounding this issue.
