US to announce that Nexperia’s Chinese facilities will resume shipments, source says

By David Shepardson

WASHINGTON (Reuters) – The White House plans to announce that Dutch chipmaker Nexperia’s Chinese facilities will resume shipments. It would be a significant boost for automakers around the world, a source with knowledge of the situation told Reuters.

The company produces large quantities of chips widely used in automobiles and consumer electronics in the Netherlands. About 70% of chips produced in the Netherlands are packaged in China and sold mostly to distributors.

Nexperia has been locked in a dispute with its Chinese unit since earlier this month after the Dutch government took control of Nexperia from its Chinese owner Wingtech Technology on September 30. The company also ousted its Chinese CEO, citing concerns that its technology could be taken over by Wingtech.

On October 4, the Chinese Ministry of Commerce blocked Nexperia from exporting chips from China.

Reuters reported on Friday that Nexperia has suspended supplies of wafers to its Chinese assembly plant, according to a letter sent to customers; This could worsen the supply crunch that worries automakers.

The White House is expected to release a fact sheet offering more details on the China trade deal later Friday.

Court records showed that the Dutch government’s seizure came at a time when U.S. pressure was increasing on Nexperia after Wingtech was placed on a restricted export list; but Dutch officials say management deficiencies are a trigger.

Stellantis, which makes Jeep SUVs, said on Thursday it had set up a “war room” to monitor the situation, raising the alarm over the possible impact on production among industry bodies.

Japanese automaker Nissan said it currently has enough chips to last through the first week of November uninterrupted.

(Reporting by David Shepardson; editing by Chris Sanders and Scott Malone)