China to Ease Export Ban of Nexperia Semiconductors to Europe Amid Chip Shortages
A major escalation in tensions between China and the Netherlands has brought relief to European businesses as China announced plans to exempt certain shipments of Nexperia semiconductors from an export ban. The move comes amid growing concerns over chip shortages that could impact the production of vehicles across Europe.
The export ban was imposed by the Netherlands last month, citing a Cold War-era law that gave it control over Dutch-based companies like Wingtech, which is backed by the Chinese government and manufactures Nexperia chips in Europe. China responded with its own ban on re-exports of Nexperia chips to Europe, accusing the US of meddling in Dutch legal procedures.
However, in a surprise move, Beijing has now announced that it will grant exemptions to exports that meet certain criteria, citing "the current chaos in the global supply chain" as the reason for the change. This announcement came after talks between Chinese President Xi Jinping and his American counterpart Donald Trump in South Korea, according to sources.
The decision is a welcome relief for European carmakers and parts suppliers, who warned of production stoppages due to the shortage of Nexperia chips. The company's chips are used in 49% of electronic components supplied to the European automotive industry, according to German financial daily Handelsblatt. The European auto lobby ACEA had warned last month that production would be seriously hit.
While the exemptions will undoubtedly ease some pressure on European businesses, concerns remain about the technology used by Nexperia. French parts maker OPmobility noted that while Nexperia's chips are widely used, they are not "unique" in terms of technology and can therefore be easily substituted.
For now, companies experiencing difficulties due to the shortage are advised to contact Chinese commerce authorities or local commerce officials for assistance. The easing of tensions between China and the Netherlands is a positive development for European businesses, which will undoubtedly breathe a sigh of relief as they look forward to a return to normalcy in their supply chains.
A major escalation in tensions between China and the Netherlands has brought relief to European businesses as China announced plans to exempt certain shipments of Nexperia semiconductors from an export ban. The move comes amid growing concerns over chip shortages that could impact the production of vehicles across Europe.
The export ban was imposed by the Netherlands last month, citing a Cold War-era law that gave it control over Dutch-based companies like Wingtech, which is backed by the Chinese government and manufactures Nexperia chips in Europe. China responded with its own ban on re-exports of Nexperia chips to Europe, accusing the US of meddling in Dutch legal procedures.
However, in a surprise move, Beijing has now announced that it will grant exemptions to exports that meet certain criteria, citing "the current chaos in the global supply chain" as the reason for the change. This announcement came after talks between Chinese President Xi Jinping and his American counterpart Donald Trump in South Korea, according to sources.
The decision is a welcome relief for European carmakers and parts suppliers, who warned of production stoppages due to the shortage of Nexperia chips. The company's chips are used in 49% of electronic components supplied to the European automotive industry, according to German financial daily Handelsblatt. The European auto lobby ACEA had warned last month that production would be seriously hit.
While the exemptions will undoubtedly ease some pressure on European businesses, concerns remain about the technology used by Nexperia. French parts maker OPmobility noted that while Nexperia's chips are widely used, they are not "unique" in terms of technology and can therefore be easily substituted.
For now, companies experiencing difficulties due to the shortage are advised to contact Chinese commerce authorities or local commerce officials for assistance. The easing of tensions between China and the Netherlands is a positive development for European businesses, which will undoubtedly breathe a sigh of relief as they look forward to a return to normalcy in their supply chains.