A growing semiconductor shortage could bring European production lines to a standstill, car makers are being warned, as the Volkswagen Group has admitted that it currently only has enough chips to last “until the end of next week”.
The growing crisis has been caused by China suspending exports of chips made by Nexperia, as part of a political dispute with the US.
This followed the Dutch government’s decision, under pressure from the Trump administration, to take control of the Netherlands-based company last month, citing intellectual property concerns caused by its Chinese ownership.
The European Automobile Manufacturers’ Association (ACEA) said the issue has left it “increasingly concerned” and that many of its members were “already expecting imminent assembly line stoppages”. It added that many are already running out of back-up supplies.
The Nexperia chips, described as “simple” by ACEA, are used in the electrical system control units of vehicles from most of Europe’s major car makers.
The effects of the shortage were outlined by the Volkswagen Group's CFO, Arno Antlitz, during the Group’s latest financial results call on Thursday.
“We look on the issue day by day and week by week, and what we can say until the end of next week, we have enough supply.” he said.
The Group has already, as of Wednesday, suspended Volkswagen Golf production at its Wolfsburg plant due to the chip shortage.
Indications are that the halt to Golf production will be followed by stoppages for at least three other models, including the Tiguan, Touran and Tayron, also built at Wolfsburg. The company hasn't indicated how long production could be halted.
To keep production lines running for as long as possible, car makers including the Volkswagen Group are looking at alternative suppliers.
“We cannot stand still,” Antlitz said. “We have responsibility. So we try to find alternative sources, get it from alternative sources. We achieved that so far.
“We secure the production day by day and week by week. We are now safe until the end of next week, and the teams continue to work. For the time being, it's good news that we are safe for another week.”
Mitigating the growing concern, Antlitz added that “we have really much more transparency than we had back in the [previous] semiconductor crisis”, referencing the global issue that plagued the automotive industry between 2021 and 2023 following the surge in demand for cars in the aftermath of the Covid pandemic.
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