Exclusive-Nexperia’s China unit resumes chip sales to domestic distributors, sources say
by Che Pan and Wen-Yee Lee
BEIJING/TAIPEI (Reuters) – Dutch chipmaker Nexperia’s China unit has resumed supplying semiconductors to local distributors, having previously halted all shipments when Beijing banned exports following an ownership dispute, according to two people with knowledge of the matter.
But as part of the resumption limited to domestic trade, all sales to distributors must now be made in Chinese yuan, whereas previously only foreign currencies such as the US dollar were used in transactions, the sources said.
The China unit has also instructed distributors to deal with customers only in yuan, in a bid to stabilize supply in China and operate more independently of its Dutch parent, one of the sources said.
Nexperia, now under the control of the Dutch government, produces large quantities of chips in the Netherlands that are widely used in the automotive industry and consumer electronics. The majority are packaged in China and sold mostly to distributors.
Nexperia is now looking for alternative packaging partners outside China as the dispute with its Chinese subsidiary shows little sign of a quick resolution, sources said.
Nexperia also warned its customers in China that it did not guarantee the quality of products supplied by its Chinese subsidiary, the second person said.
They spoke on condition of anonymity due to the sensitivity of the issue. The temporary suspension of sales and the resumption of payments in yuan had not been previously announced.
A Nexperia spokesman declined to comment on the Chinese unit’s actions, saying efforts to seek packaging partners outside China began before the dispute and were not part of the move away from the Chinese factory.
As for quality, the spokesperson said he should have informed customers about potential risks, but stopped short of saying they should not buy products from the Chinese unit.
Nexperia’s China unit did not respond to a request for comment.
THE DUTCH GOVERNMENT TOOK CONTROL
The Dutch government took control of Nexperia on September 30 and dismissed its Chinese CEO, Zhang Xuezheng, citing concerns that its technology could be seized by Nexperia’s Chinese parent company, Wingtech Technology.
Court records showed that the seizure followed increased U.S. pressure on Nexperia after Wingtech was placed on a restricted export list; But Dutch officials say management deficiencies are a trigger.
On October 4, the Chinese Ministry of Commerce blocked Nexperia from exporting chips from China.
Following the order, Nexperia’s China unit suspended shipments from its main Dongguan factory to all distributors, the first person said.
