Published On 6/11/2025
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Last update: 21:07 (Mecca time)
Nexperia has stopped supplying chips to its factory in China because its local unit refused to pay its dues, revealing internal disputes at the struggling auto chip maker.
The Dutch company, owned by Chinese company WingTech Technology, supplies power control chips used by carmakers from Volkswagen to BMW, and informed its customers on October 29 that it would stop supplying chips directly to its assembly plant in China.
Nexperia stated in a statement issued yesterday evening, Wednesday, that its entities there have stopped operating within the established corporate governance framework, and that it is ignoring global management instructions.
The company, headquartered in Nijmegen in the Netherlands, said: “We cannot supervise whether and when the products will be delivered from our factory in China. Due to the lack of transparency and control over manufacturing processes, we cannot guarantee the intellectual property, technology and quality standards of the products being delivered from the Nexperia factory in China as of October 13.”
Conflict with the Netherlands
In September, the Dutch government took control of Nexperia, fearing WingTech would disrupt the chipmaker and threaten the supply of vital components, and China responded by imposing restrictions on exports of Nexperia products, putting the auto industry’s supply chain at risk and forcing automakers to slow production.
Nexperia announced yesterday, Wednesday, that its Chinese unit’s refusal to pay for chips shipped to its factory “is not an isolated incident.” It alleged the misappropriation of Nexperia’s corporate seals in China without a legitimate reason or explanation, and said that the unit sent unauthorized messages containing false information to customers, subcontractors, third-party suppliers and employees.
It added in its statement that Nexperia in China also created “unauthorized bank accounts and was directing customers to transfer payments to them.”
This week, China criticized the Dutch government for not taking sufficient steps to resolve the dispute, after Beijing announced on November 1 that it would grant exemptions to Nexperia’s exports from China.
The chip maker welcomed China’s commitment to restore the supply chain, but on Wednesday it expressed its hope to see more details about the conditions, standards and procedures related to lifting restrictions.