Nexperia halts wafer shipments to Dongguan plant amid dispute

Dutch chipmaker Nexperia has suspended shipments of silicon wafers to its assembly plant in Dongguan, southern China, escalating a dispute that industry officials warn could squeeze supplies for automakers worldwide. The company said it halted shipments on October 26 after its interim chief executive concluded the plant’s local management had failed to meet agreed contractual payment terms, and warned that supply would not resume until those obligations were satisfied.

In a letter to customers, Nexperia’s interim chief executive, Stefan Tilger, said the company had maintained shipments “for as long as commercially feasible” but that continuing the flow from its front end sites was no longer justifiable. The letter said Nexperia was developing alternative solutions to maintain supply to customers and that the move did not reflect an intention to withdraw from the Dongguan site or the Chinese market.

The suspension comes after the Dutch government on September 30 invoked national security powers to assume control of Nexperia from its Chinese owner, Wingtech Technology, and replaced the company’s Chinese chief executive. Beijing responded by blocking exports of finished Nexperia...