Nexperia Trade Restrictions Update: October 22, 2025

Nexperia Overview

Since spinning off from NXP in 2017, Nexperia has been headquartered in the Netherlands but owned by Wingtech Technology, a Chinese holding company that was added to the Entity List in December 2024. At the time of Wingtech’s addition to the list, Nexperia publicly stated it would continue to conduct business as usual, despite the status of its parent company.

Nexperia owns a 9.7 percent market share of the products it sells, mostly power components like diodes, transistors, MOSFETs, IGBTs, and logic ICs. In recent years, it has been focusing on the automotive market, investing in silicon-carbide (SiC) and gallium-nitride (GaN) technologies to enhance its portfolio.

Nexperia retained its intellectual properties and patents during its separation from NXP. However, it is not completely vertically integrated and relies on other companies to supply software, equipment, and raw materials for its facilities. Though the company owns facilities for wafer manufacturing, assembly, and testing, it also receives many wafers from Wingsky Semi in China—another subsidiary of Wingtech—as well as from other sources outside of China. It also subcontracts outside OSAT vendors for final packaging.

A large portion of raw-material suppliers are located in China and are therefore not subject to the US policy, but Nexperia will still find it difficult to obtain all of its raw-material requirements from allowed sources. ITEC, a Dutch equipment maker and subsidiary of Nexperia following a 2021 spinoff, makes a good portion of equipment for its parent company. Other equipment for Nexperia’s standard mature, SiC, and GaN products also come from non-Chinese suppliers that are subject to the US policy, placing the company’s capacity expansion at risk. Though it can create a large portion of its capacity on its own, some of its production ability and wafer supply comes from companies now barred from working with Nexperia. In the long run, Chinese equipment makers could step in and fulfill its equipment needs for the mature and legacy nodes Nexperia uses.

Rising Geopolitical Concerns

According to the Dutch government, Wingtech has built a new factory in China that could take over capacity for Nexperia’s wafer-manufacturing facilities in the UK and Germany. Worries that Nexperia would move all of its production and intellectual property to China—costing the Netherlands thousands of local jobs—prompted the Dutch government to use an obscure rule to seize management control of the company, citing national-security concerns. On October 7, the Dutch government suspended Nexperia’s CEO, Zhang Xuezheng, from participating in management of the corporation. In retaliation to this, the Chinese Chamber of Commerce prohibited the company from exporting any products made in China.

Even if Nexperia could establish a new supply chain to be compliant with the updated US policy via a solution centered around China, it still could not sell the resultant goods outside of China. However, since the Dutch government controls the company, Nexperia cannot even attempt to recreate that type of supply chain. Thus, Nexperia’s long-term options are extremely limited.

Estimates indicate that Nexperia has held approximately 150 days’ worth of inventory for most of 2025, likely a combination of finished components and works-in-progress. Integrated device manufacturers (IDMs) like Nexperia also typically hold 70-80 days’ worth of raw materials on hand. Now that its ability to procure raw materials is in jeopardy and some of its packaging capabilities are hampered, Nexperia’s output is limited, affecting its entire portfolio.

Nexperia has been given a 60-day grace period from being fully subjected to the new rules by the US. The company said that it is “confident that a solution will be found.” It has also said that it is working with Chinese officials to mitigate restrictions placed on it by the Chinese government.

Downstream Effects on the Market

A few days after the Chinese Chamber of Commerce prohibition, Nexperia sent a notice to its customers stating that it will be unable to fulfill many new and already placed orders. This prompted an immediate reaction from the channel. Franchise distributors halted quotes, end users that had been attempting to liquidate excess inventory stalled their efforts, and OEMs began searching for stock as quickly as they could. Most open-market inquiries have been coming from European automakers, which have been more dependent upon Nexperia than US and Chinese automakers due their shared regionality.

Since that notice, requirements for Nexperia products have skyrocketed. However, very little material remains available on the open market following the moves made by Nexperia, its channel partners, and end users. What does exist is coming at greatly increased prices, which are changing hourly as inventory is removed from access.

While most inquiries derive from the automotive industry, the industrial, networking, and consumer segments are also concerned about Nexperia’s circumstances.

If Nexperia is unable to come to a resolution with either the US or Chinese governments, it will suffer greatly, and the result could put a strain on its competitors. Since it mainly makes mature products that are also made by a number of other companies, there are options for most of its parts. Its 9.7 percent market share would likely be redistributed among other vendors of similar components, such as onsemi, Infineon, Texas Instruments, Diodes Incorporated, Wolfspeed, and Littelfuse.

Additionally, there are several lesser-known vendors in China and Taiwan that could also absorb portions of the market share, especially in the low-cost and high-volume segments.

The problem with this possibility is that those companies are maintaining low production rates for many of these items and cannot quickly increase production to manage a sudden spike in demand. Even if they wanted to, it takes time to increase production by thousands of wafers to cover the loss of Nexperia’s output. These vendors will also have some difficulty forecasting which products to build and at what quantities. Not only will the targets be volatile, but the companies will face competition for orders amongst one another and uncertainty around how much those competitors would be willing to risk excess inventory buildup.

The 60-day window appears to be a long time to work with considering Nexperia’s estimated on-hand inventory represents three full cycles of component creation. Still, the company only has two months to purchase raw-material inventory and plan for future cycles. If its competitors do not increase some production capabilities to make up for Nexperia’s possible shortfall, many end users could find themselves in a bind in the first quarter of 2026.

We will continue to monitor the situation and share the latest updates as they become available.