BERLIN: A trade dispute between China and the Netherlands has impacted the European auto industry, which is now afraid of production halts and potentially even factory closures.
German engineering giant Bosch has issued a warning that the present Nexperia dispute could impact its production, while Volkswagen has informed that its output is safe for a week, although short-term disruptions are possible.
The carmakers BMW and Mercedes-Benz have also acknowledged the burden placed on their supply chains, which is only getting heavier with the escalation of the situation.
The crisis escalated after the Dutch government took over the Nexperia semiconductor company which was a China-owned company and China responded by prohibiting the export of the company’s products.
Bosch has cautioned that if the dispute is extended in time, they will be forced to put some of their employees on a short-time work scheme at their factories. The company is doing everything possible to keep the activities running smoothly but at the same time, it has conceded that it cannot rule out a production stoppage.
The 1,400 Bosch employees at the Salzgitter plant, who are responsible for manufacturing motor control units for electric vehicles, are already feeling the pressure.
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Nexperia’s chips are pivotal to automotive parts and thus, the ban really disrupts the already affected auto industry.
