The European Automobile Manufacturers' Association warns that "some" of its members "already foresee imminent shutdowns on the assembly lines." This means that various European car manufacturers will have to halt their activity in the coming days, and the origin, ACEA adds, lies in "the political dispute that has led to the export ban of Nexperia chips from China." And although the European industry association does not mention them, the complex picture also includes the Netherlands, Donald Trump, and ultimately, geopolitics.
The sequence of events is as follows. The U.S. government, at the end of last year, blacklisted Wingtech. This company, in turn, has a subsidiary in the Netherlands called Nexperia, which is the largest supplier of crucial microchips for car manufacturing and was also included in the Trump administration's blacklist. The U.S. also directly targeted CEO Zhang Xuezheng, accusing him of industrial espionage.
The U.S. government thus began pressuring the Dutch government, which ultimately decided to intervene in Nexperia last September. Essentially nationalizing it. The Dutch government denied that its move was due to Washington's intimidation, but outlets like Reuters reported that the decision's goal was for the U.S. to remove Nexperia from its blacklist.
But China did not stand idly by. Their next move was to signal the export ban on chips, leading to "the consequent shortage of supply of the simple chips used in the control units of vehicle electrical systems." This situation "is severely affecting car manufacturers worldwide, including European ones. The industry is currently using reserve stocks, but supplies are running out quickly," ACEA warns in a statement released this Wednesday.
One possibility is to seek alternative suppliers, which do exist. "But it will take several months to increase the additional capacity needed to cover the supply shortage," the industry association continues.
"We know that all parties involved in this dispute are working very hard to find a diplomatic solution. At the same time, our members report that parts supplies are already being halted due to the shortage," stated ACEA's Director General Sigrid de Vries. "This means that assembly line shutdowns could be just days away. We urge all parties involved to redouble their efforts to find a diplomatic way out of this critical situation," she added.