How the Nexperia Crisis Is Shaping the Semiconductor Market: a Z2Data Report

The Nexperia ownership dispute has been one of the more striking, of-the-moment supply chain stories in recent memory. But the story isn’t over, and the events to date reveal new vulnerabilities for supply chains dependent on Nexperia parts or their alternatives. In our original analysis, we examine the dispute itself, the fragilities exposed within Nexperia’s supply chain, and the potential impact to manufacturers relying on components from the chipmaker.

Overview

It started when the U.S. Department of Commerce announced the new Bureau of Industry and Security “Affiliates Rule” at the end of September—an announcement that triggered sanctions on Dutch semiconductor manufacturer Nexperia due to its 2018 acquisition by Wingtech Technology. (Wingtech was added to the BIS Entity List in December of 2024). In response, the Dutch government attempted to seize ownership of the company. Just days later, China—where much of Nexperia’s semiconductor manufacturing is based—struck back, issuing export controls on Nexperia’s Chinese facilities and its subcontractors. 

The Nexperia Chip Crisis Timeline

• September 29: The U.S. Department of Commerce issues a new rule that expands the scope of the Bureau of Industry and Security’s Entity List. The agency’s new rule, as outlined on the BIS website, stipulates that any organization that is at least 50 percent owned by a company on the Entity List is itself subject to the list’s restrictions. Because it was acquired by Wingtech Technology in 2019, Nexperia becomes subject to Entity List restrictions. 
• September 30: The Dutch government attempts to take control of Nexperia by invoking the Goods Availability Act. According to the Dutch government, this measure was carried out “following recent and acute signals” that “posed a threat to the continuity and safeguarding on Dutch and European soil of crucial technological knowledge and capabilities.” 
• October 4: The Chinese Ministry of Commerce issues export controls on Nexperia’s Chinese unit and its subcontractors. They are prohibited from exporting finished components and subassemblies manufactured in China to foreign countries. 
• October 19: A letter written by Nexperia’s Chinese management and obtained by the media asserts that Nexperia is a “Chinese company with operations rooted in China” and therefore has a priority to adhere to Chinese regulations. The letter further implores employees to “disregard external interference.” 
• October 22: Volkswagen tells its workers that a production stoppage could be imminent due to the supply chain issues triggered by the Nexperia standoff. German newspaper The Bild cited sources reporting that work stoppages were already being scheduled to start the following Wednesday, October 29. 
• October 23: The Japanese Automobile Manufacturers Association (JAMA) says that Nexperia had recently notified Japanese autopart manufacturers that it might not be able to fulfill chip deliveries. JAMA adds that the semiconductors in question are essential components in electronic control units, and any shortages could reverberate across JAMA’s members, including Toyota, Honda, and Nissan. 
• October 30: The U.S. and China reach a trade agreement: the Trump administration suspends the BIS Affiliates Rule for one year, and China commits to restoring operations at Nexperia’s China facilities to maintain supply of critical legacy chips.
• November 7: European automakers confirm that shipments of Nexperia chips have resumed. 
• November 19: The Dutch government suspends its intervention at Nexperia as a goodwill gesture. China calls it a “first step in the right direction,” but says the act does not satisfy all of China’s demands.

Temporary Relief in the Form of a Trade Deal and Detente

With a supply chain crisis looming, U.S. President Trump and Chinese President Xi Jinping struck a critical trade agreement in late October. The deal called for the U.S. to suspend the BIS Affiliates Rule for one year and for China to grant exemptions to Nexperia chips used in civilian applications, including automotive. Since then, Nexperia chip shipments have resumed to European automakers, easing pressure on manufacturers worried about another supply chain crunch. 

The deal called for the U.S. to suspend the BIS Affiliates Rule for one year and for China to grant exemptions to Nexperia chips used in civilian applications, including automotive.

Then, on November 19, the Dutch government announced that it would be suspending its intervention at Nexperia, citing encouraging steps on the part of China to resume the exportation of chips out of the country.

Why Many Problems Still Remain for Nexperia & Its Customers

But the temporary relief won by the trade agreement does not resolve the ongoing impact to the chip supply chain, much of which has no easy or immediate fix.

First, there’s the issue of industry-level impact. Nexperia semiconductors coming out of China—where much of the company’s IC assembly takes place—are used in consumer electronics, aerospace and defense, and medical technology, among other industries. The bottleneck created by the ownership crisis and China’s subsequent export controls are posing a substantial risk to manufacturing all over Europe—and, by consequence, the broader global supply chain. 

Then there’s the question of quality. In response to China issuing export controls on Nexperia’s Chinese unit and its subcontractors in early October, Nexperia B.V. temporarily stopped shipping wafers to its main Chinese IC assembly facility in Dongguan.

Then there’s the question of quality. In response to China issuing export controls on Nexperia’s Chinese unit and its subcontractors in early October, Nexperia B.V. temporarily stopped shipping wafers to its main Chinese IC assembly facility in Dongguan.

‍
In an official November 14 update on its website, Nexperia assured stakeholders that its Chinese facilities likely had enough wafers to continue exporting chips and honoring orders for the next several months. But the company struck a cautionary tone. “Given the missing transparency and oversight over the manufacturing processes we cannot guarantee the intellectual property, technology, authenticity and quality standards for products delivered from the Nexperia facility in China as of October 13.”

Finally, there’s the issue of dependency. The Nexperia ownership dispute has exposed the chipmaker's reliance on its Dongguan facilities and various Chinese subcontractors, as well as manufacturers' dependence on Nexperia components. This creates a two-fold challenge: Nexperia faces ongoing vulnerability due to its dependence on Chinese operations—an issue unlikely to be resolved soon—while manufacturers must reassess their own exposure and seek alternative sources. Unfortunately, neither path offers an easy solution.

The Nexperia ownership dispute has exposed the chipmaker's reliance on its Dongguan facilities and various Chinese subcontractors, as well as manufacturers' dependence on Nexperia components.

Ultimately, there's no single consequence from the Nexperia crisis—there are many—and each factor is contributing to the broader picture of semiconductor supply chain uncertainty. Even if the political, regulatory, and ownership issues surrounding Nexperia are reversed, these dynamics may persist.

Manufacturers who fail to grasp these challenges, and the ways the landscape has shifted as a result, could find themselves at a serious disadvantage.

How Vulnerable Are You, Really?

To help manufacturers understand the ongoing risks at play with Nexperia, we analyzed four points of vulnerability that have emerged from this crisis:

• Nexperia’s exposure tied to its China-based manufacturing
• Shrinking access to Nexperia parts through authorized channels
• Changes in availability among alternative component suppliers
• Evolving trends in independent distributor inventory 

For access to the full analysis, download our comprehensive report here.

Nexperia’s Dependency on Chinese Manufacturing

Much has been made of how essential Nexperia chips are to the global automotive supply chain. But little information has come out detailing specifically which Nexperia chips are fabricated and/or assembled in China, and therefore most vulnerable to this ownership standoff.

An analysis of Z2Data’s database identified the ten Nexperia commodity categories most impacted by recent events, largely due to their reliance on the company’s China-based manufacturing sites. This dependency amplifies the operational and geopolitical risks tied to Nexperia’s current situation, leaving certain product families especially exposed. These categories are arranged by both the total number of Nexperia MPNs manufactured in China and the percentage of each commodity group produced there.

As the table illustrates, Nexperia is heavily reliant on its facility in Dongguan—as well as its network of Chinese subcontractors—for IC assembly. Over three-quarters of Nexperia's Zener diodes; GP BJTs; and switches, multiplexers, and decoders are assembled in China, and significant numbers of MOSFETs, rectifiers, and logic gate and inverters are either assembled or fabricated there. This has particularly strong implications for the auto industry, which relies heavily on Nexperia’s zener diodes, BJTs, and MOSFETs. 

To see all our insights on Nexperia inventory, the market for alternative suppliers, and other key trends stemming from the ownership crisis, download the full report. 

See Your Risk with Z2Data

To learn more about Z2Data and how the SCRM platform can help you effectively mitigate this growing supply chain risk, schedule a demo with one of our product experts. You can also contact your Z2Data representative or email us at info@z2data.com.