European car manufacturers diversify chip suppliers
new measures are designed to reduce Europe’s exposure to single-source dependencies and strengthen the resilience
The European Union is preparing to introduce tougher semiconductor sourcing rules for automakers following recent supply chain disruptions linked to Nexperia, a chip manufacturer with Chinese ownership ties that exposed vulnerabilities across Europe’s automotive industry.
Under draft legislation expected to be unveiled next month as part of the proposed Chips Act 2, major car manufacturers including Volkswagen, Stellantis and Renault could be required to source semiconductors from multiple suppliers in certain strategic categories and formally incorporate supply chain resilience into procurement strategies.
The new measures are designed to reduce Europe’s exposure to single-source dependencies and strengthen the resilience of critical industrial sectors against geopolitical tensions and future supply disruptions.
According to EU officials, the proposed legislation reflects a broader shift in European industrial policy as the bloc seeks to strengthen technological sovereignty and reduce strategic reliance on external semiconductor suppliers.
“The Chips Act 2 will reflect today’s technology landscape and geopolitical realities,” said Thomas Regnier.
Europe’s automotive sector has faced repeated supply chain challenges since the COVID-19 pandemic disrupted global semiconductor availability and highlighted the importance of chips across modern vehicle production, from lighting systems to advanced electronic controls and autonomous technologies.
The Nexperia crisis is now viewed by policymakers as a key turning point. Nexperia, which was acquired in 2019 by Chinese manufacturing group Wingtech Technology, held a significant share of Europe’s automotive semiconductor market, particularly in foundational automotive chips.
After Wingtech was added to a US sanctions list in late 2024 over concerns related to potential military applications, restrictions were expanded to affiliated companies including Nexperia. The subsequent intervention by the Dutch government and temporary export restrictions from China created supply shortages that disrupted automotive production across Europe.
While tensions later eased and exports resumed, the episode reinforced concerns within Brussels about concentrated semiconductor supply chains and the risks associated with geopolitical dependency.
The proposed Chips Act 2 is expected to go beyond the original EU Chips Act by introducing stronger obligations on industries considered strategically important, including automotive manufacturing, defence, energy and critical infrastructure.
EU policymakers increasingly view diversified semiconductor sourcing and supply chain resilience as essential components of Europe’s long-term industrial competitiveness and economic security.
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