Diamond Electronics continues to monitor semiconductor and other supply related concerns to and therefore would like to inform you of recent developments concerning Nexperia, a key semiconductor manufacturer, and the potential implications for component availability.

Key Background

On September 30, 2025, the Dutch government invoked the Goods Availability Act, a Cold War-era law, to take control of Nexperia, a semiconductor manufacturer based in the Netherlands and owned by Chinese firm Wingtech. The move was made public on October 13.

Key Reasons:

· Governance Failures: Acute signals of serious governance shortcomings, including reckless financial decisions and conflict of interests with the CEO.

· Security Concerns: Fears over the transfer of critical technological knowledge to China.

· Semiconductor product availability: Fears that major shortcomings could jeopardise the supply of chips to Europe.

· US Pressure: The U.S. warned the Dutch government that Nexperia’s CEO, Zhang Xuezheng, must be replaced to avoid being added to the U.S. Entity List.

Immediate Actions Taken:

· Suspension of CEO: Zhang Xuezheng was suspended for reckless leadership, including questionable wafer purchases and mismanagement of financial operations.

· Independent Oversight: Wingtech’s voting rights in Nexperia are now managed by an independent administrator.

· Government Oversight: All strategic decisions require Dutch government approval for one year.

Implications

While Nexperia have said that day to day operations will continue as usual, with no disruption expected, the geopolitical implications of the Dutch Government actions could impact supply.

This includes:

· China’s Retaliation: The Chinese Ministry of Commerce imposed an export ban on Nexperia’s Chinese operations, particularly affecting its Guangdong plant, which handles 70% of final product shipments.

· Legal & Diplomatic Pushback: Wingtech is consulting international law firms and seeking support from Chinese authorities to challenge the Dutch decision.

This may lead to:

· Supply chain disruptions: China’s ban on certain dual-use components assembled in China could disrupt supply to European and U.S. clients if exemptions are not granted.

· Inventory Volatility: Potential shortages may lead to price fluctuations and increased lead times.

Recommendations for action:

If you have immediate or upcoming requirements for Nexperia components, we recommend considering the following:

· Audit Inventory: Review current stock levels and forecasted demand.

· Secure Supply: Place orders early to avoid potential shortages.

· Call-Off Agreements: Discuss flexible stock arrangements with us to secure stock in advance.

· Diversify Sources: Evaluate alternative components for critical parts and systems.

Our account managers can assist in identifying issues and mitigating supply chain disruptions for all your Nexperia component requirements. Our team is actively monitoring the situation and will continue to provide updates. We are committed to helping you mitigate any supply chain risks and ensure continuity in your operations.

Please don’t hesitate to reach out with any questions or concerns.

📞 +44 (0) 1477 500450
✉️ sales@diamondelec.co.uk