In a saga that has gripped the global semiconductor and automotive industries, the Dutch government’s latest move to relinquish its special powers over Nexperia—a Chinese-owned chipmaker headquartered in the Netherlands—has temporarily eased tensions with Beijing. But beneath this diplomatic reprieve lies a far more complicated story: a vivid illustration of the West’s accelerating efforts to reduce dependency on China’s semiconductor supply chain, and the ripple effects this has sent through international commerce.
The timeline of events reads like a geopolitical thriller. On September 29, 2025, the US Bureau of Industry and Security expanded its Entity List rules, automatically covering any firm majority-owned by a sanctioned entity. The very next day, the Dutch government invoked the Goods Availability Act, taking temporary control of Nexperia and citing "serious governance shortcomings." This triggered swift retaliation: on October 4, China blocked Nexperia China and its subcontractors from exporting certain finished components and sub-assemblies made in China.
The consequences were immediate and severe. The Dutch Enterprise Chamber suspended Nexperia CEO Zhang Xuezheng on October 7, appointing Chief Financial Officer Stefan Tilger as interim chief executive. The tension escalated further when Nexperia’s Dongguan plant refused to comply with agreed payment terms. In response, Tilger halted wafer shipments from Europe to China on October 26—an action that threatened to disrupt chip supplies to a slew of global automotive giants, including Honda, Volkswagen, Ford, and General Motors.
Automakers felt the sting almost instantly. According to reporting by MotorBiscuit, Honda was forced to adjust production at its US and Canadian factories on October 27, and the following day, it halted a plant in Mexico. Honda’s sprawling North American operations—Marysville, Ohio (Accord), East Liberty, Ohio (CR-V), Greensburg, Indiana (Civic and some CR-Vs), and Lincoln, Alabama (Pilot, Passport, Odyssey, Ridgeline)—all faced uncertainty as chip shortages bit into supply lines.
Relief, however, was not far behind. On October 30, US President Donald Trump met with Chinese President Xi Jinping in South Korea. In a move interpreted as a diplomatic olive branch, Trump agreed to delay the implementation of Washington’s new "penetrating sanction rules" by one year. This pause in escalation set the stage for further negotiations.
By mid-November, the Netherlands and China had reached a tentative agreement following meetings on November 18 and 19. Dutch Minister of Economic Affairs Vincent Karremans announced on November 19 that the government would suspend its order under the Goods Availability Act, describing the Chinese measures to ensure chip supplies to Europe and the world as "a show of good will." In his words, "The Netherlands has considered it the right moment to take a constructive step by suspending the order under the Goods Availability Act, in close consultation with European and international partners."
Wingtech Technology, Nexperia’s parent company, quickly issued a statement on November 20, confirming that the Dutch government had lifted its special powers and allowed Nexperia to regain control of its chip-making unit. The company called the decision "a constructive step following weeks of intensive negotiations." But if anyone thought the saga was over, they were mistaken.
Supply chain fragility, once an abstract concern, became painfully real. The dispute exposed just how much global automotive and industrial supply chains depend on the steady flow of Chinese components. Executives and policymakers across Europe and the United States found themselves scrambling to adapt, warned that a new era of operational uncertainty—driven by geopolitical risk—was at hand.
"China’s decision to de-escalate was likely motivated by a desire to avoid triggering an accelerated decoupling of its semiconductor supply chains as well as a global trade war," Klaus Schmitz, a partner at Arthur D. Little, told Asia Times. He noted that Western players’ ability to demonstrate credible substitution and circumvention measures showed that dependency risks can be, at least partially, managed. "Going forward, Western companies will undoubtedly intensify efforts to de-risk their semiconductor supply chains. From an industry-wide perspective, this implies that additional production capacity outside China will need to be established, especially since Nexperia was among the top 3 to 5 global suppliers in its segment."
China, for its part, is unlikely to sit idly by. Schmitz suggested that Beijing will counter Western decoupling trends with competitive pricing, favorable contract terms, and policy incentives to maintain its role in global chip manufacturing. Jian Junbo, director of Fudan University’s Center for China–Europe Relations, told ThePaper.cn that the controversy "remains far from fully resolved, with both sides still engaged in negotiations." He cautioned that the final impact on the industry would depend on the eventual agreement reached, as "China’s stance is clear and unlikely to soften."
European capitals, meanwhile, are increasingly applying a security-led lens to their economic ties with China. This marks a structural shift that is both long-term and likely to intensify, according to Jian. He warned that the evolving posture underscores deeper structural tensions in China-European Union relations, suggesting that both sides will have to adjust their supply chain strategies if political risk continues to rise.
On November 20, Chinese Commerce Minister Wang Wentao told UK Secretary of State for Business and Trade Peter Kyle that "the responsibility for the Nexperia issue lies squarely with the Dutch side." He added, "China, acting from a position of responsibility, granted exemptions for qualified civilian-use exports, which helped ease the crisis. The Dutch decision to suspend the order is a first step in the right direction. We hope the Netherlands will truly assume its responsibilities and take concrete action as soon as possible." Wang called on the Dutch side to facilitate a lawful, negotiated resolution of Nexperia’s internal disputes to help restore stability to the global semiconductor supply chain.
Yu Yongjie, a columnist at the Beijing Youth Daily, compared the Nexperia saga to the historic An-Shi Rebellion, suggesting that the Dutch underestimated their dependency on China. "The Netherlands thought that it could settle the issue by taking control of Nexperia’s headquarters and management, but it failed to grasp that 80% of Nexperia’s wafers need to be sent to Nexperia China for packaging and testing. European manufacturing is deeply bound to China, so every punch Europe throws ultimately lands on itself." He also noted that former President Trump’s decision to delay new sanctions played a key role in de-escalating the crisis, urging the Dutch government to learn from the experience.
Despite all the drama, the practical impact on automakers like Honda remains somewhat murky. In mid-November, Honda announced it would resume regular output at all North American plants effective November 24, 2025. But when pressed by reporters to confirm whether Nexperia had resumed shipments or if chips were sourced elsewhere, Honda’s spokesperson demurred, saying only to "ask Nexperia." For now, it seems, the chip crisis has abated—but questions linger, and the underlying vulnerabilities remain.
As Klaus Schmitz observed, "Virtually every modern industry, from manufacturing and chemicals to pharmaceuticals, telecoms, energy and healthcare, depends on a stable semiconductor supply." The Nexperia episode has made it clear that supply disruptions are no longer driven only by natural or economic shocks. "Geopolitical power dynamics now shape access to critical components, and companies must build geopolitical resilience into long-term sourcing and industrial strategies if they want to withstand the next crisis."
The story of Nexperia is far from over. As governments and industries around the world grapple with the new realities of technological rivalry and supply chain fragility, every decision—no matter how small—can send shockwaves through the global economy. For now, the world watches and waits, knowing that the next chapter could be just around the corner.
