Major automakers, including Honda, Volkswagen, Stellantis, and more, are facing potential production disruptions due to a shortage of automotive semiconductor chips. The issue stems from the Dutch government’s control of Nexperia, a chip supplier owned by Chinese company Wingtech Technology Co, amid geopolitical tensions between the U.S. and China. The situation has prompted automakers to establish “war rooms” to address the global supply chain issue and find alternative sources for critical components.

The automotive industry is closely monitoring the situation, with fears of assembly line stoppages if a resolution is not reached soon. German automakers, in particular, are vulnerable to disruptions as they heavily rely on suppliers like Nexperia for essential parts. The ongoing chip shortage, impacting legacy semiconductors used in key vehicle functions, underscores the industry’s vulnerability to supply chain disruptions caused by political tensions. Ford, GM, Honda, and other automakers are actively engaged with government officials to find a diplomatic solution and avoid further production losses.