U.S. Automakers Warn of Production Risks Amid Chip Dispute Between China and Netherlands

A major chip supply disruption caused by escalating tensions between China and the Netherlands is threatening to impact U.S. auto production, industry groups have warned. The issue centers on Nexperia, a Dutch-based semiconductor manufacturer owned by China’s Wingtech, which recently fell under tighter control by the Dutch government due to national security concerns.

According to the European Automobile Manufacturers’ Association (ACEA), automakers and suppliers were informed last week that Nexperia could no longer guarantee chip deliveries, potentially causing significant production setbacks. The Alliance for Automotive Innovation, representing major companies like General Motors, Ford, Toyota, Volkswagen, and Hyundai, has called for a swift resolution, emphasizing the gravity of the situation.

“If the shipment of automotive chips doesn’t resume quickly, it’s going to disrupt auto production in the U.S. and many other countries,” said John Bozzella, CEO of the Alliance. Several automakers, speaking anonymously to Reuters, confirmed that U.S. assembly lines could face disruptions as early as next month.

The crisis deepened after the Dutch government took control of Nexperia on September 30, citing fears of sensitive technology being transferred to its Chinese parent company, Wingtech. This move followed months of U.S. pressure and export control concerns. Washington added Wingtech to its entity list in December, further tightening restrictions on technology exports.

In retaliation, China’s commerce ministry issued an export control notice on October 4, banning Nexperia China and its subcontractors from exporting certain finished components. Although European manufacturers like Volkswagen and BMW have not yet reported production impacts, they are actively assessing supply chain risks as the semiconductor standoff intensifies.