Berlin: German auto parts giant Bosch said it is preparing to furlough workers at its Salzgitter plant as a deepening trade dispute between China and the Netherlands threatens to disrupt chip supplies vital to Europe’s car industry.
The conflict arose from Beijing’s decision to ban exports of finished products from Dutch chipmaker Nexperia, after the Netherlands moved to seize control of the company. Nexperia’s Chinese parent, Wingtech, has been flagged by the United States as a potential national security risk. As Nexperia’s semiconductors are widely used in vehicle components, the standoff has raised alarm across Europe’s car-making sector.
“We are currently doing everything we can to serve our customers and avoid or minimise production restrictions. We have not yet made any adjustments to working hours at our German locations, but are preparing to do so, particularly in Salzgitter,” a Bosch spokesperson said in a statement.
We are deeply concerned by potential significant disruption to European vehicle manufacturing if the interruption of Nexperia chips supplies cannot be immediately resolved.
On 10 October, #automobile manufacturers and their suppliers received notice from Nexperia outlining a… pic.twitter.com/RW8qveXCng
— ACEA (@ACEA_auto) October 16, 2025
The Salzgitter facility, which employs about 1,400 people, produces motor control units for both combustion and electric vehicles. Bosch added that it is working with alternative suppliers and optimising inventory levels to prevent production stoppages.
Volkswagen confirmed that it had secured production in Germany for the coming week across all its brands, including Porsche. However, a spokesperson cautioned that “short-term impacts on the production network of the Volkswagen Group cannot be ruled out.” BMW and Mercedes-Benz have also reported strain on their supplier networks.
Union representatives have expressed concern over the unfolding situation. Industry sources said that while switching to alternative suppliers such as Infineon, NXP, or Texas Instruments is possible, approval processes could take time, potentially prolonging the supply crunch.
Auto industry associations have urged a diplomatic solution to the rising trade tensions. Dutch Prime Minister Dick Schoof reportedly raised the issue during this week’s EU summit in Brussels.
