Nexperia says Chinese unit operating as usual as tensions with Netherlands run high

BEIJING, Oct 18 (Reuters) – Nexperia said on Sunday its employees in China still had access to the company’s platforms and received their salaries as usual, a day after its Chinese subsidiary asserted it had the right to operate independently of the Dutch parent company.

“We are aware of a message distributed by individuals at Nexperia China falsely claiming that Nexperia and the Dutch government have abandoned the Chinese market and that the factory is now operating under a new entity,” the Dutch chipmaker told Reuters.

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The company said any statements regarding unpaid wages were “factually incorrect and misleading.”

A notice on its official WeChat account states that all of its employees continue to work according to the unit’s instructions and may reject any “external instructions” not approved by its Chinese legal representative.

Salaries and bonuses will continue to be paid by Nexperia China and not by Nexperia Netherlands.

A few days later, on October 4, China’s Ministry of Commerce blocked Nexperia from exporting chips from China.

“This situation resulted from the unauthorized actions of our former CEO Wing Zhang (Xuezheng), who was formally suspended by a competent court… and has no authority to represent Nexperia,” the Dutch chipmaker said.

Nexperia reported Zhang’s actions to Dutch authorities and said it remained committed to its employees and customers in China. Nexperia did not specify what unauthorized actions its former CEO took.

Wingtech and Nexperia China did not immediately respond to requests for comment.

Nexperia’s chips, while not technically sophisticated, are widely used in large quantities.

Its largest manufacturing site is in Hamburg, Germany, but according to two sources briefed on the matter, more than 70% of Nexperia’s chips are sent back to China for packaging in Dongguan, a manufacturing hub in China’s southern Guangdong province.

($1 = 7.1264 Chinese yuan renminbi)

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