The German automotive supply chain is under escalating pressure amidst the protracted trade conflict involving Nexperia Semiconductor. Chip shortages have triggered production halts, leaving thousands of Bosch employees in limbo. Despite the Dutch government dispatching a high-ranking delegation to Beijing in pursuit of a resolution, a definitive agreement remains elusive.

Nexperia Semiconductor's chips are integral components in automotive electronic systems. Following the Dutch government's acquisition of the Chinese-controlled Nexperia Semiconductor, China imposed restrictions on the export of its finished products, precipitating a worldwide chip supply deficit. This has directly impacted three Bosch factories in Germany and Portugal, necessitating temporary leave arrangements for the workforce. ZF Friedrichshafen has cautioned that its chip reserves will deplete by mid-next week, potentially prompting similar actions.

The German Association of the Automotive Industry has sounded the alarm, stating that the situation remains precarious, with the supply chain bracing for further disruptions in the forthcoming weeks. The ripple effects of this crisis are also being felt on a global scale, with Nissan Motor announcing plans to scale back production next week.