Inside the Turmoil: A Firsthand Look at Nexperia’s Dongguan Factory Amid Raw Material Shortages, Shipping Restrictions, and a New “Four-On-Three-Off” Work Schedule

The Dutch government’s intervention in Nexperia (Anshi Semiconductor) has now rippled far beyond boardrooms, reaching deep into factory floors and the far ends of the supply chain.

On October 18, a Daily Economic News reporter conducted an on-site investigation at Nexperia’s Dongguan factory, discovering that since the National Day and Mid-Autumn holidays, the plant has restricted shipments and plans to implement a “four-days-on, three-days-off” work schedule starting next week. Meanwhile, several traders have confirmed growing shortages and rising price pressures.

In response, parent company Wingtech Technology (600745.SH) stated that its China division has launched an “independent rescue plan,” working urgently to rebuild a localized supply chain to meet customer demand. But the key question remains: how feasible is this “domestic supply chain relink”?

Traders Traveling Across Provinces for Stock
The situation has escalated quickly. Reports have surfaced alleging interruptions in salary payments for Chinese employees and restricted system access, while online discussions about shortages and price hikes continue to intensify.

Headquartered in the Netherlands, Nexperia operates globally. Wingtech completed its full acquisition of the company in 2020 after several rounds of capital restructuring. According to Wingtech’s June 2024 investor statement, its semiconductor business spans multiple R&D centers, wafer fabs, and packaging facilities worldwide. In China, operations include R&D centers in Shanghai, Shenzhen, and Hong Kong, and major packaging and testing plants in Dongguan and Wuxi (under construction).

On October 18, the reporter visited the Dongguan plant in Huangjiang Town — Nexperia’s largest packaging and testing base, covering 100,000 square meters and employing about 4,000 workers. Outside the factory gates, several customers and distributors had gathered. Two clients from Suzhou said they traveled over 1,000 kilometers overnight just to check on deliveries. “We told them we were customers coming to collect goods, but there’s just no stock,” one said.

A Shenzhen-based trader added that his company had stationed staff onsite for days. “We need to report to clients, and being here gives us the latest information,” he said, noting that while shipments had stopped for more than a week, production inside hadn’t completely halted.

According to several traders, factory representatives merely said, “There’s nothing we can do,” without offering further clarification. Although some trucks were seen entering and exiting the facility, it was unclear whether any carried outbound goods.

A representative from one of Nexperia’s key distributors, JiaHua Fuchang Information Technology (Shanghai) Co., confirmed that the company began limiting shipments after the October holidays. “Stock is running low, and while the factory hasn’t officially raised prices, market shortages are already pushing prices higher,” they said.

Production Feels the Pinch of Supply Chain Disruption
Wingtech’s 2024 annual report highlights Nexperia’s rapid growth — from the world’s 11th-largest power semiconductor company in 2019 to 3rd in 2023, maintaining the top spot in China. This makes the impact of the Dutch government’s intervention all the more significant.

Following the incident, Chinese authorities responded swiftly. On October 4, the Ministry of Commerce issued an export control notice prohibiting Nexperia China and its subcontractors from exporting certain products and components manufactured in China.

Inside the Dongguan factory, the effects of raw material shortages are now visible. One production efficiency manager told reporters that due to material constraints and staffing adjustments, some positions will adopt a “four-on, three-off” schedule starting next week, reducing overtime from around 80 hours per month to roughly 50. “Orders are still full — the problem is raw materials,” he said.

A warehouse staff member noted that incoming goods now far exceed outgoing shipments. “Production hasn’t stopped, but stock is piling up. We’re running out of space,” he said.

The Shenzhen trader corroborated this, adding that while there’s still some material inventory left, it’s running tight. “They’re cutting production because the materials will only last until the end of December,” he said.

Industry expert Chen Qi told Daily Economic News that Nexperia’s chip design and wafer manufacturing are centered in Europe, while Dongguan handles about 70% of global packaging tasks. If restrictions persist, both sides of the business will suffer.

The European Automobile Manufacturers’ Association (ACEA) also voiced concern on October 16, noting that although carmakers are sourcing similar chips from other suppliers, qualification and production ramp-up will take months — while Nexperia chip inventories typically last only a few weeks.

Chen added that while industrial and consumer clients can shift to domestic alternatives relatively quickly, automotive clients — due to strict certification barriers — will face greater short-term pressure until new suppliers are approved or Nexperia’s operations stabilize.

The Challenge of “Localizing” the Supply Chain
Dongguan’s factory plays a critical role, handling 70% of Nexperia’s final product shipments. The Chinese market is equally vital — Wingtech’s 2025 semiannual report shows that China accounted for 48.17% of revenue, compared with just 21.72% from Europe.

Amid the ongoing disruptions, Wingtech representatives told media that the company is racing to “relink the domestic supply chain” to ensure stable delivery to local customers. Some analysts have suggested using Nexperia’s technology while leveraging Wingtech’s majority shareholder subsidiary, Dingtai Jiangxin, as a foundry partner.

Wingtech has already been accelerating its local supply chain strategy. Its 2025 mid-year report notes efforts to expand share in automotive, industrial, and consumer sectors, advance domestic replacements for power and analog ICs, and enhance production capacity via the 12-inch wafer fab in Shanghai Lingang. Its latest MOS products have reportedly reached world-class performance levels.

Still, full “localization” remains a long and complex process. Chen noted that since Nexperia’s core design and wafer production are still based in Europe, true independence would require transferring these functions to China — a move fraught with technical and regulatory challenges.

Moreover, any change in raw material suppliers must pass customer certification. “Even if they switch suppliers, clients must re-approve everything — and that takes time,” said one Shenzhen trader.

While Nexperia’s October 14 statement claimed the company is applying for export control exemptions and mobilizing all available resources to minimize disruption, no clear timeline has been given for resuming shipments. Distributors such as JiaHua Fuchang also confirmed that they are awaiting further updates from the manufacturer.

Daily Economic News reporters reached out to Wingtech for comment but received no response by press time. At the Dongguan facility, staff declined to pass on interview requests.

As Chen concluded, “This issue has gone beyond the corporate level — its resolution will ultimately depend on high-level diplomatic and policy coordination.”