Chipmaker Nexperia said it halted China shipments on payment refusal

Dutch semiconductor producer Nexperia said it suspended shipments of wafers — the thin silicon discs used to make chips — to its China subsidiary after the local unit refused to make payments.

The move adds to a governance crisis at the Chinese-owned chipmaker, which plays a key role in Europe’s car supply chains.

In a statement, Nexperia said on Wednesday that its China operations had “stopped operating within the established corporate governance framework” and were disregarding instructions from its headquarters in Nijmegen, the Netherlands.

It said it could no longer ensure the “intellectual property, technology, authenticity and quality standards” of products made at its Dongguan plant in southern China since mid-October.

The company also accused the local team of opening unauthorised bank accounts and misusing company seals — actions it said made it impossible to guarantee oversight of the factory.

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Nexperia produces more than 100 billion chips a year, including power management components used by carmakers such as Volkswagen, BMW and Mercedes-Benz. Its wafers are critical to many low-cost electronics and automotive systems.

The company, owned by Shanghai-listed Wingtech Technology, has been at the centre of political tensions since the Dutch government took temporary control of it in September. The Hague cited national security concerns and suspended Wingtech’s chairman Zhang Xuezheng from his role as Nexperia’s CEO.

China responded by briefly blocking exports of Nexperia chips in early October, a decision that European carmakers warned could disrupt production within days before curbs were partially lifted.

Nexperia said its other manufacturing sites in Europe and Asia continue to operate as normal and that it remains “fully committed” to its Chinese staff and customers.

China’s Commerce Ministry accused the Netherlands of failing to resolve issues at Nexperia, saying the suspension of wafer supplies had caused “turmoil and chaos” in the global semiconductor supply chain. It added that the Netherlands “should bear full responsibility” and warned of further disruptions.

Nexperia said that it is working to identify “alternative supply chain solutions” and hopes that “de-escalation can be achieved soon”.

The dispute comes as the European Commission continues to monitor China’s export control measures on chips and rare earth materials. EU tech commissioner Henna Virkkunen met Nexperia officials last week, saying afterwards on X that both sides discussed steps to strengthen supply chain resilience. Brussels has since invited the company to join the EU’s Chips Act Task Force, which is gathering data on the economic impact of ongoing trade restrictions.