Nexperia: Will China's Export Shift Help Auto Supply Chains?

China is lifting its export controls on chips produced by Chinese-owned Nexperia, granting exemptions for civilian use. 

The move relieves pressure on European automakers, which had warned of looming shortages due to the disruption. 

At the same time, China has suspended a planned ban on materials crucial to semiconductor production and waives port fees for US-linked ships, all as part of wider trade easing with the US.

The chips in question, produced by Nexperia, a Dutch-based semiconductor specialist owned by Chinese company Wingtech, are simple, low-cost components but essential for modern car electronics.

Though based in the Netherlands, about 70% of Nexperia’s chips are completed in China and then exported globally. 

When the Dutch government took control of the firm in October over what it called “serious governance shortcomings,” China responded by blocking exports, putting supply chains at risk. This export block affected nearly three-quarters of Nexperia’s global chip output and triggered immediate concern from European automakers. 

The European Automobile Manufacturers’ Association (EMEA) warned stockpiles would last only weeks unless exports resumed.

The move put pressure on automakers across the region. Volvo Cars, Jaguar Land Rover and Volkswagen all warned that limited chip supply could force temporary production halts. 

In response to the growing pressure, China’s commerce ministry confirmed it would now exempt Nexperia chips for civilian use, removing the licensing requirement for exporters.

EU Trade Commissioner Maros Sefcovic says the country has agreed to "the further simplification of export procedures for Nexperia chips", adding that discussions with Dutch and Chinese officials continue "as we work towards a lasting stable predictable framework that ensures the full restoration of semiconductor flows". 

China’s ministry also used the announcement to criticise the Dutch government’s decision and call on the EU to "continue exerting its influence to urge the Netherlands to correct its erroneous practices as soon as possible". 

China softens wider trade stance

The decision on Nexperia forms part of a broader easing in trade tension between Beijing and Washington. 

After a high-level agreement in October between President Xi Jinping and US President Donald Trump to pause tariff escalations, China moved to suspend additional export bans targeting US access to key semiconductor materials. These include gallium, germanium, antimony and super-hard materials – classified as "dual-use items" because they can serve both civilian and military functions. That suspension now runs until 27 November 2026.

Port fees for US-linked ships are also waived for one year, with China’s transport ministry confirming the change from 11 November.

Professor David Bailey from the University of Birmingham calls the Dutch government's move "a wake-up call" for the car industry.

He says: "The Dutch government may well have had good reasons to take control but it hadn't thought through the implications. The retaliation from China was swift and brutal."

He also urges automakers to plan for future supply interruptions: "There’s a need to find alternative processing sites - maybe in south east Asia or Europe - and keep bigger stocks of products."

Automakers respond and reflect

In an exclusive interview with Supply Chain Digital, Nicolai Martin, Member of the Board of Management for Purchasing and Supplier Network at BMW, confirmed that, although the firm does not purchase chips directly from Nexperia, the components are embedded in parts delivered by suppliers. 

“They are small and cheap parts but with relevant impact spread over the whole vehicle,” he says. “Our production still runs as planned but we are in a volatile situation. That can change.”

Nicolai says BMW uses established processes developed during the chip crisis to track risks through its supplier base. 

“We had transparency on this topic in a few hours,” he says, crediting internal procedures and supplier cooperation.

However, he admits that lessons from the previous crisis focused on more complex chips and missed the risks of these “super small and mass product parts". 

He continues: "There are suppliers supporting a much longer supply also with exterior parts now and others with short supply chains. That leads to additional lessons learned with some partners.”

While BMW has avoided production disruption, Nicolai notes: “We give our best to avoid impact if it comes to the political discussion. The whole topic was created through political aspects. We appreciate the fast clarification and deescalation, but the effects on the supply chain must still be managed.”

For supply chain leaders, this signals deeper challenges. 

Sapna Amlani, Supply Chain Director at Moody’s, adds: "The Nexperia case isn’t just a governance dispute – it’s a warning shot for global supply chains." 

The disruption, she notes, affected basic components that are foundational to manufacturing: “When they stop flowing, industries stall.”

Her advice includes multi-sourcing, building in governance checks, scenario planning and improving real-time visibility tools. 

“Supply chains are moving from efficiency-driven to resilience-driven,” she adds. 

“Companies that act now – diversifying, digitising and stress-testing their networks – will be better positioned when the next geopolitical fault line emerges.”