The vital flow of chips from China to the car industry in Europe looks poised to resume as part of the deal struck last week between Donald Trump and his Chinese counterpart, Xi Jinping.
The Netherlands has signalled that its standoff with Beijing is close to a resolution amid signs China’s ban on exports of the key car industry components is easing.
The dispute began when the Dutch government took control of the chipmaker Nexperia at the end of September after the US raised security concerns about the company’s Chinese owner, Wingtech. Beijing retaliated by halting all exports from Nexperia’s factories in the country, threatening to disrupt car production in Europe and Japan.
The White House had put Wingtech on a list of companies that would have their exports to the US controlled under its “affiliate rule”. However, as part of the deal between Trump and Xi in South Korea, the US authorities will now delay the implementation of this rule for a year in exchange for China pausing its own restrictions on exports of chips and crucial rare-earth minerals.
The Dutch economy minister, Vincent Karremans, said on Thursday he trusted that Nexperia chips would reach customers in Europe and the rest of the world in the coming days.
Meanwhile, one of the main suppliers to the German car industry, Aumovio, confirmed on Friday it had received notice from China that chips supply would resume to its operations.
“We applied for and received an exemption from the export restrictions. We received it the day before yesterday verbally, yesterday in writing,” Aumovio’s chief executive, Philipp von Hirschheydt, said after the company reported its third-quarter results.
At the heart of the dispute is control of Nexperia’s operations in Nijmegen, the Netherlands, after the company was acquired by the partially state-owned Wingtech in 2018. Karremans took control of the chipmaker on 30 September amid fears its operations and intellectual property would be moved to China.
Nexperia in the Netherlands said it was pleased by the one-year suspension of the US affiliate rule and also welcomed China’s commitment to “facilitate the resumption of exports” from the company’s Chinese facility.
But it added that there continued to be some concerns and that it could not tell “if or when” products from its facility in China would be delivered.
The row that threatened to halt car assembly lines in Europe underlines the global nature of car industry’s supply chain and the vulnerability of European and Japanese companies that rely on China for chips.
US authorities had also raised security concerns about Wingtech and Nexperia’s Chinese chief executive, Zhang Xuezheng, in June, court documents show.
Four days after the seizure, China banned exports from Nexperia’s factories in the country, where about 70% of its chips are packaged before distribution. By the end of last month, Nexperia had retaliated by halting chip supplies to a Chinese plant.
Bloomberg reports on Friday cited sources who said the Dutch government was ready to shelve the order that gave it power to block or change key corporate decisions at Nexperia on the condition that China resumed exports of critical chips.
Karremans said the Netherlands had been informed by Beijing and Washington that the deal struck by Trump and Xi last month would enable the resumption of supplies from Nexperia’s facilities in China.
“This is also consistent with information provided to the European Commission by the Chinese Ministry of Commerce,” he said.
