Nexperia crisis: how geopolitics disrupts a global chip supply chain

The ongoing dispute between China and the Netherlands over chipmaker Nexperia has highlighted how geopolitical tensions can disrupt an otherwise smooth global supply chain, according to analysts.

Based in Nijmegen, Netherlands, Nexperia exemplifies a typical multinational company with front-end fabrication plants in Hamburg, Germany, and Manchester, UK, as well as back-end assembly facilities across Asia, including Dongguan, China; Laguna, the Philippines; and Negeri Sembilan, Malaysia.

The company is also supported by a worldwide network of sales offices and research labs. Thanks in part to its global presence, Nexperia ships more than 110 billion products a year to a diverse customer base that includes Apple, Tesla and Samsung Electronics.

That supply chain was thrown into uncertainty last month when Dutch authorities seized control of Nexperia’s management and ousted its Chinese CEO, Zhang Xuezheng, who is also the founder of the company’s owner, Wingtech Technology.

The dramatic move came after the US Bureau of Industry and Security recently extended export control restrictions to entities at least 50 per cent owned by companies already on a Washington trade blacklist.

As Nexperia is wholly owned by blacklisted Wingtech, it became subject to US sanctions.

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