Hazakhstan International News Agency report: In the context of highly globalized semiconductor industry, the Netherlands and Chinese governments have taken rare intervention actions regarding the control of Dutch chip company Nexperia, which has attracted widespread attention. This event originated from corporate governance disputes but quickly evolved into a symbol of geopolitical friction, exposing the vulnerability of key technology supply chains. As a core supplier in the automotive and consumer electronics sectors, Nexperia's risk of production interruption is testing the resilience of the international chip ecosystem.

The Hatanews commentator analyzed the causes and development of this incident and assessed its potential impact.

Background of the Incident: From Corporate M&A to Governance Crisis

Nexperia, headquartered in the Netherlands, is a global semiconductor company with a long and rich history in Europe. It currently employs more than 12,500 people across Europe, Asia, and the United States. As a leader in the development and production of basic semiconductor devices, Nexperia's components are widely used in automotive, industrial, mobile, and consumer electronics applications, providing support for the fundamental functions of almost all electronic designs worldwide. The company serves global customers, shipping over 11 billion products annually. These products are recognized as benchmarks in terms of process, size, power, and performance.

The origins of Nexperia can be traced back to the semiconductor division of the Dutch electronics giant Philips. In 2019, the company was wholly acquired by Wingtech Technology, a listed company in Shanghai, China. A portion of Wingtech's shares is held by the State-owned Assets Supervision and Administration Commission of the State Council of China. At the time, this move was seen as a routine business acquisition, helping Nexperia expand its capacity, with annual shipments exceeding 10 billion chips, mainly focusing on "mature" semiconductors in the automotive, industrial, and consumer electronics sectors, such as diodes, transistors, and MOSFET power devices.

As Sino-US trade tensions escalated, Western countries became increasingly wary of Chinese capital's penetration into sensitive tech areas. Although Nexperia's products are not the most advanced (such as AI processors), they have a large volume of "legacy chips" with widespread applications, especially indispensable in automotive electronics. In 2022, the UK government cited national security concerns and forced Nexperia to sell 86% of its shares in the Newport Wafer Fab chip factory in Wales. In 2024, the U.S. Department of Commerce added Wingtech to the "Entity List," restricting its access to U.S. technologies and components, forcing Wingtech to divest parts of its business in March 2025 to avoid risks.

Entering 2025, internal governance crises became the catalyst. In June, U.S. Commerce Department officials met with the Dutch Ministry of Foreign Affairs, pressuring them to remove the Chinese CEO of Nexperia, Zhang Xuezhen, to prevent further sanctions against the company. Meanwhile, a shareholder structure dispute erupted within the company: Wingtech accused non-Chinese executives of "forcibly altering equity" through the Amsterdam court, while the Dutch government was concerned about "technology leakage"—core intellectual property and technical capabilities could be transferred to the Chinese parent company.

On September 30, Dutch Minister of Economic Affairs Vincent Klaassen invoked the Goods Availability Act, a law left over from the Cold War era, to implement a "highly exceptional" intervention in Nexperia. This law allows the government to intervene in private companies in emergencies to ensure the supply of critical goods. This decision was not nationalization, but rather granted the government a "veto power": any decision that might harm the company's interests, the future of Dutch/European business, or European supply chain stability (such as asset transfers or executive appointments) could be reversed or blocked by the minister. The Dutch government emphasized that the move aimed to prevent emergency risks caused by "governance deficiencies" and ensure chip supply in times of crisis.

Consequences of the Incident: Chinese Countermeasures and Negotiation Deadlock

The Dutch intervention triggered a chain reaction. On October 14, the China Semiconductor Industry Association condemned the move as "selective discrimination," stating it undermines global trade openness. Chinese Foreign Ministry spokesperson Lin Jian stated that Beijing "firmly opposes the overgeneralization of national security concepts and discriminatory practices targeting specific country enterprises."

More direct countermeasures followed: On October 4, the Chinese Ministry of Commerce issued a notice prohibiting the export of specific finished components and subcomponents (mainly packaged chips) from Nexperia's Chinese subsidiary and its subcontractors, citing "national security interests." This ban directly cut off the Asian supply chain link of Nexperia, causing global production disruptions.

Wingtech responded that operations were "not interrupted," but admitted that control was "temporarily limited" and initiated legal and diplomatic avenues to seek redress. Its chairman, Zhang Xuezhen, was also suspended from his board position. Nexperia stated that daily production continued, but automakers such as Stellantis, Renault, and Volkswagen expressed concerns that supply chain disruptions could manifest within weeks. Wingtech's stock price fell 10% in Shanghai. On October 17, the Dutch Minister of Economic Affairs announced a meeting with Chinese officials to try to resolve the deadlock, but the ongoing Sino-US high-level friction (such as U.S. threats to impose 100% tariffs on Chinese exports) made the negotiation prospects unclear.

Currently, the situation remains in a stalemate: the Netherlands may appeal to the court, Wingtech is evaluating legal remedies, and the Chinese export ban has already caused initial losses. Although the Hamburg factory of Nexperia (which produces 10 million chips annually) is not shut down, it relies on China for packaging, leading to delays in finished product deliveries. This conflict highlights how geopolitics can rapidly amplify internal corporate conflicts.

On October 19, Nexperia China released an open letter titled "Nexperia China to All Employees" through its official WeChat account. The letter emphasized that Nexperia China is a Chinese enterprise rooted in China and facing the world, must comply with Chinese laws and operate in a lawful and compliant manner. The company always makes independent decisions, with the legal representative responsible for all operations, and senior executives must fulfill their duties of loyalty and diligence. The open letter pointed out that employees should continue to follow the work instructions of Nexperia China, and have the right to refuse to execute any external instructions (such as those sent via Outlook or Teams) without the consent of the legal representative, which would not constitute disciplinary or illegal actions. Additionally, the company's operations and employee salaries and benefits are normal, and the production and operation are progressing smoothly. The board and management will fully guarantee the operation, and no external forces will interfere or harm employee interests. Employee labor relations and wages, bonuses, and benefits are all paid by Nexperia China, and the company promises to provide support to employees.

Nexperia's Production Process: Vertical Integration of Global Division of Labor

Nexperia is headquartered in Nijmegen, the Netherlands, with over 12,500 global employees, an annual production capacity of 10 billion components, and focuses on "discrete semiconductors," such as power MOSFETs and diodes. These small-sized, high-efficiency components are widely used in electric vehicle chargers and industrial automation. Its production process is highly automated and vertically integrated (from wafer to packaging), but it also reveals the pain points of global division of labor.

The process is roughly divided into two major stages: front-end and back-end:

1. Front-end manufacturing (chip production): This is the "heart" of the chip, mainly completed in Europe. The chip factories in Hamburg, Germany (established in 1953) and Manchester, UK (specializing in power MOSFETs) use 6-inch and 8-inch silicon wafers.

The process includes:

  • Chip preparation: Cutting single-crystal silicon ingots into thin slices (approximately 0.5 mm thick), polishing to a mirror-smooth surface.
  • Lithography and etching: Applying photoresist, exposing circuit patterns with ultraviolet light, then chemically etching to form micrometer-scale structures.
  • Doping and deposition: Injecting impurities (such as phosphorus or boron) to change the conductivity of silicon, adding insulating layers or metals through chemical vapor deposition (CVD).
  • Thermal treatment and testing: High-temperature annealing to activate doping, high-precision probe testing for preliminary functionality. The Hamburg plant produces over 10 million chips annually, equivalent to the base for 10 billion components.

2. Back-end packaging and testing: After the chips are cut into individual chips, they are transferred to Asian factories. The packaging lines in Guangdong, Malaysia's Seremban, and the Philippines' Cabuyao are responsible for this stage.

The process of this stage includes:

  • Die cutting and bonding: Laser or saw cutting the wafer, bonding the chip to the lead frame.
  • Packaging molding: Injecting epoxy resin to form the housing, welding the leads, ensuring heat resistance (automotive-grade AEC-Q101 standard).
  • Final testing: Electrical performance and reliability tests (such as ESD electrostatic protection), qualified products are shipped out.

Nexperia integrates chip making and packaging into a one-stop process, achieving high efficiency and low cost. However, "chip making" in Europe and "packaging" relying on Asia has made the Chinese export ban directly block the back end, leading to a backlog of semi-finished products in Europe and global delivery delays.

Impact on the International Chip Supply Chain: Pressure on the Automotive Industry, Accelerated Fragmentation

Although Nexperia is not a "high-end" chip giant, its products are the "hidden pillars" of the supply chain. The global automotive industry relies on its legacy chips (such as diodes used in engine control and safety systems), and these components have long certification cycles (months to years), making short-term replacement difficult.

China's ban on chip packaging exports has prevented Nexperia from completing the "packaging," leading to a backlog of semi-finished products in European factories and a 10-20% delay in global chip deliveries. Automakers like Volkswagen and Renault are running low on inventory, and the European Automobile Manufacturers Association (ACEA) warned that this turmoil could lead to reduced or even halted car production, affecting new vehicle deliveries.

From the perspective of long-term geopolitical risks, this dispute is likely to further strengthen the ongoing "de-risking" trend in the international arena, prompting countries to prioritize self-protection more urgently. The EU is investing heavily (50 billion euros) to build local chip factories, and the U.S. may further restrict technology exports. However, China controls rare earths and the packaging segment, and retaliation could push up global chip prices by 5-10%, making electronic products more expensive.

Additionally, this incident will inevitably accelerate the reshaping of the global supply chain, leading to increased fragmentation and making small suppliers "victims." The automotive industry is turning to diversification (such as packaging in Vietnam or India), but high certification barriers may drive up electric vehicle prices. Overall, this incident accelerates the "decoupling" between China and the U.S. in technology, and the global chip market (expected to exceed 600 billion USD in 2025) faces uncertainty, with developing countries (such as Southeast Asia) possibly benefiting.

This incident reminds the international community that although the globalization of the semiconductor supply chain is efficient, it is vulnerable to geopolitical shocks. The Netherlands and China are seeking balance through diplomatic channels, but in the short term, the production pressure on the automotive and electronics industries is unlikely to subside.

Original article: https://www.toutiao.com/article/7563537320130576905/

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