Carmakers Race Against Time to Hoard Chips in China Trade Fight

The scary spot global automakers find themselves in right now, thanks to a nasty back-and-forth between China and the West over tiny computer chips that keep cars running. It all boiled over last week, on October 10, when the Dutch government stepped in and grabbed control of Nexperia, a key chip maker based in Nijmegen, Netherlands.

Nexperia, owned by China's Wingtech Technology, pumps out hundreds of these essential parts for every single vehicle—think sensors for brakes and engines etc. But Beijing fired back fast with export bans, warning that no more chips would flow out. Carmakers like Germany's Volkswagen and U.S.-based Ford got the bad news straight from suppliers: deliveries could dry up in as little as a month.

These aren’t attention-grabbing devices; these are the hidden protectors that keep your SUV running steady in traffic. Europe's auto bosses are scrambling in closed-door meetings, stocking up on whatever they can grab. Suppliers in Germany say switching to backups might take three to six months—plenty of time for assembly lines to grind to a halt.

This situation connects directly to larger disputes, such as the EU imposing tariffs on affordable Chinese electric vehicles in July, and China retaliating by enforcing stricter regulations on batteries and EVs. Oh, and with U.S. President Donald Trump set to sit down with China's Xi Jinping later this month in Washington for trade talks, everyone's holding their breath.

These trade disputes highlight how our vehicles rely on delicate global connections. If leaders don’t address this soon, empty lots at dealerships may soon become the standard.

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