The Dutch government's undue interference in semiconductor manufacturer Nexperia's operations could have a serious impact on Europe's crucial auto sector unless a constructive solution is found, according to a Germany-based analyst.
In a ministerial order issued late September, the Dutch Ministry of Economic Affairs moved to freeze the global operations of Nexperia, an overseas subsidiary of Chinese company Wingtech, citing so-called "national security" concerns. China's Ministry of Commerce slammed the decision as violating market principles and said it would damage the Netherlands' own business environment. Martin Geissler, a partner of Munich-based strategy consulting firm Advyce and Company, highlighted how a considerable number of major companies in the manufacturing and auto industry have already been hit by the fallout, and said the knock-on effects could bring more widespread impacts across Europe. "Nexperia chips are in all of their products, and when we look at Bosch and ZF for example, two of their most important suppliers, they have already started to slow down production in their main plants. As we know that in the automotive industry everything is just in time, just in sequence. It will only be days until that will also affect the car plants of VW and the other OEMs (Original Equipment Manufacturers) in Germany," he said in a recent interview with China Central Television (CCTV). Geissler also noted the growing calls across Europe for the Netherlands and other countries to cooperate more closely with China to ensure the stability and smooth operation of the global semiconductor supply chains.
"What we definitely need is for Europe to also have a long-term strategy for its relationship with China, and especially a relationship strategy that is independent of its strategy to the U.S., and if [only] both countries can converge on something like that and start to be real partners. So, this is something that definitely has to change," he said.
Dutch gov't interference in Nexperia's operations threatens wider European auto industry: analyst
Dutch gov't interference in Nexperia's operations threatens wider European auto industry: analyst
