By Jonathan Cassell
It has only been slightly more than one year since the automotive supply chain finally emerged from the massive electronic component shortage that plagued car makers from Q2 2021 through Q3 2024.
Now, in October 2025, the automakers and their suppliers face the specter of a new shortfall – one that has already impacted car production.
A dispute over the ownership of automotive chip supplier Nexperia has halted deliveries of critical discrete devices, an event that is already interrupting car production. For automakers worldwide, the Nexperia crisis adds to a slew of trade-war related supply-chain issues that have arisen in 2025, ranging from tariffs on aluminum and steel, to rare-earth shortages, to export controls on graphite.
While the nature of this new shortage is different from the last one, the event is compelling the automotive supply chain to adopt some of the same measures it did in the early 2020s to manage the previous shortfall.
Nexperia spurs the next shortage
The Dutch government on September 30 seized control of Chinese-owned chipmaker Nexperia, spurring China’s Ministry of Commerce to prohibit the company from exporting some finished components and sub-assemblies manufactured in China. This action has stopped overseas shipments from the company’s facility in Guangdong China that the company describes as “the largest small-signal assembly site,” with a capacity of more than 50 billion diodes and transistors annually.
The impact of this small-signal diode and transistor supply disruption is already being felt by global automakers. Honda, on October 29, suspended production at a plant in Mexico due to disruptions in semiconductor supplies from Nexperia.
The European Automobile Manufacturers’ Association (ACEA) warned of imminent production stoppages for automakers in Europe and the U.S.
The Motor & Equipment Manufacturers Association (MEMA), a U.S. auto parts trade group, warned that American carmakers could see their manufacturing operations disrupted by mid to late November. Nexperia also alerted Japanese auto‑parts manufacturers that it may not be able to guarantee future deliveries, raising concerns of a supply disruption for electronic control unit (ECU) components, according to a media report.
Carmakers face cascade of supply chain challenges
The Nexperia situation is adding to the extensive list of woes already stressing the automotive supply chain this year, including:
- Chinese export controls on graphite and rare earth minerals — China’s restrictions on overseas sales of graphite battery anode materials and rare earth magnets stand to reduce the availability of batteries and electric motors.
- U.S. aluminum and steel tariffs have increased costs for automakers, leading to rising costs.
- Competition with data centers for chip supply — Due to overwhelming demand from the data center AI market, certain sensors, memory types, and power devices are facing supply shortfalls. Automakers now find themselves vying with cloud-service providers to secure supplies of such chips.
- Potential GPU supply issues in China — China’s largest automaker, BYD, is facing the prospect of a cut off from the Nvidia chips it uses in cars for automated driving capabilities.
In addition to rising costs and constrained availability, these issues have spurred increased supply-chain uncertainty and made it difficult for procurement organizations to plan.
Auto supply chain returns a war footing
With the array of supply challenges, particularly the Nexperia situation, automotive component buyers need to gird themselves for battle using some of the same strategies and techniques they relied on during the last shortage.
For starters, automotive procurement management organizations are advised to restart the semiconductor purchasing task forces they originally established in the early 2020s to manage the shortage situation. These operations should keep a close eye on discrete lead times to gauge the severity of the mounting shortage.
The previous shortage became apparent when delivery lags began to stretch for a key group of semiconductors heavily used in automotive applications, including capacitors, power ICs, transistors, and microcontrollers. The average Supplyframe Commodity IQ Lead Time Index for these parts rose higher than a score of 150 in Q2 2021, a well-above-the-baseline reading that indicates that lead times were significantly extended compared to the historical median. The average score finally fell back below the 150-score threshold in Q3 2025, showing that lead times had normalized to a large degree.
For this shortage, procurement organizations should keep a close watch on transistor and diode lead times. The lead time indexes for these devices were at benign levels in Q3, with diodes at 135.1 and transistors at 85.6. Since automotive-grade parts represent only a small slice of the total available market for these devices, the Nexperia supply situation may not have an enormous impact on their indexes immediately. However, a rise in delivery lags in the coming months could reflect the outsized impact of Nexperia shortage.
These task forces also should quantify their dependence on Nexperia chips and work with other suppliers to provide alternative sources. While there may be some substitutes for Nexperia small signal discretes, these parts may not be useful for every automaker. As a result, automotive buyers will need to prepare to fight to secure their share of the dwindling supplies of small signal discretes.
With an array of other supply challenges to contend with beyond the discrete shortage, the supply-chain task forces will also be useful to deal with other issues.
With the last shortage not far away in the rear-view mirror, automotive buyers already have the techniques and experience required to deal with the latest supply chain challenges. Now is the time to put them to use.