Nexperia Chip War Continues To Deep Fry Germany’s Automotive Industry

A deepening crisis is unfolding in the heart of Germany’s automotive industry, exposing once again the fragility of global corporations’ just-in-time supply chains. ZF Friedrichshafen, one of the world’s largest auto suppliers and a pillar of German industrial might, has been forced to cut production at its Schweinfurt plant due to a semiconductor shortage. The shortage, in turn, is the direct outcome of escalating geopolitical conflict — in this case, between China and the West — over control of chipmaker Nexperia.

Beijing’s decision to block Nexperia’s exports came after the Dutch government seized control of the company, citing national security concerns. This standoff is not merely a technical supply issue, but a symptom of the growing fragmentation of a global capitalist economy that once prided itself on seamless integration.

ZF’s Schweinfurt facility, employing about 8,000 people, sits at the intersection of two major corporate transitions: the move from fossil fuels to electrification, and from globalised to fragmented production. Its slowdown threatens not just ZF’s profits, but also those of Volkswagen, BMW, Mercedes-Benz, and other automakers who depend on its output.

This is a reminder that the global economy’s “efficiency” — long celebrated by corporate leaders — is built on a fragile system of interdependence easily shattered by national rivalries. As firms like ZF and Bosch now cut hours and scale back work, it’s workers who will once again pay the price for a crisis made in boardrooms and ministries, not on the factory floor.