The global semiconductor shortage, which has severely impacted automotive production, may see some relief after the Dutch and Chinese governments announced a partial easing of restrictions on Nexperia, a key supplier of legacy chips. This follows months of escalating tensions over alleged intellectual property theft and unauthorized financial activity by the company’s Chinese arm.
The Core of the Dispute
The crisis began when the Dutch government, in October 2023, invoked emergency powers to prevent Nexperia from relocating assets, terminating executives, or making major decisions without approval. This action stemmed from concerns that Nexperia’s Chinese leadership, led by CEO Zhang Xuezheng, was attempting to move critical production equipment, intellectual property, and finances to China.
The Dutch government claims to have evidence that Zhang Xuezheng was preparing to siphon assets from the European facilities. Meanwhile, Nexperia BV, the company’s Netherlands-based holding company, accuses Nexperia China of refusing payments for wafers, misappropriating company seals, and redirecting customer payments to unauthorized bank accounts.
Temporary Relief, Lingering Uncertainty
The Dutch government has now temporarily suspended the emergency order, citing “constructive dialogue” with Chinese authorities. In response, China has eased some export restrictions on Nexperia’s Chinese operations. However, a separate ruling from the Dutch Enterprise Chamber remains in place, barring Zhang Xuezheng from holding his position and keeping control of Wingtech’s Nexperia shares under court supervision.
This situation is critical because Nexperia is one of the last remaining European suppliers of “legacy” semiconductors — older, but vital, microchips used in vehicle functions like power steering, airbags, and central locking. The company previously manufactured chips in Europe but shipped 80% of them to China for processing, testing, and packaging.
Industry Response and Future Outlook
The VDA, Germany’s auto industry association, has cautioned that supply remains uncertain and production disruptions are still possible. Nexperia BV itself is actively pursuing “alternative supply chain solutions” while the crisis unfolds.
The dispute highlights the growing geopolitical tensions surrounding semiconductor supply chains. Wingtech, Nexperia’s parent company, was added to the US trade restriction list in December 2024, and the US subsequently warned Nexperia it would face embargoes if Zhang Xuezheng remained in charge – a threat that materialized in September 2025.
The easing of restrictions is a step forward, but the fundamental issues of trust and control over critical technology remain unresolved. The long-term stability of Nexperia’s operations, and the wider European semiconductor landscape, will depend on sustained diplomatic efforts and concrete safeguards against further asset stripping.
The temporary truce offers a glimmer of hope for automakers and electronics manufacturers, but the underlying vulnerabilities in the global chip supply chain persist, demanding continued vigilance and diversification.
