German auto parts sector rushes to get China exemptions for Nexperia chip exports

By Eduardo Baptista, Rachel More and Toby Sterling

BERLIN (Reuters) -German automotive suppliers were rushing for exemptions to Chinese export restrictions on Nexperia chips on Monday, hoping for a political solution to a trade stand-off that has caused alarm over possible production stoppages in the car industry.

A fight over Nexperia, which makes large volumes of basic chips used in cars, threatens to halt car assembly lines after the Netherlands seized control of the Dutch company over concerns about its Chinese parent Wingtech.

Fuelling hopes for a political solution, China said on Saturday it would consider exemptions to the chip exports affected by the Dutch move.

Germany's Aumovio is among the automotive suppliers that have sought exemptions from Beijing, having submitted its application with the Chinese commerce ministry, a person familiar with the matter said.

A spokesperson for Aumovio declined to comment.

"China did open up the regulations a little bit for the export of stock," said Dominik Zillner of Components at Service (CAS), a German-based electronics component distributor.

However, this can only be done with special permission from the Chinese commerce ministry, he added.

Carmakers and their suppliers face possible production stoppages if the issue over Nexperia is not solved quickly.

Europe's top carmaker, Volkswagen, has not been able to guarantee production at its German sites beyond this week, while supplier Bosch has registered plans to furlough workers at its Salzgitter site due to squeezed supply.

Peer ZF said on Monday it was also preparing for such measures as a precaution.

"It is unclear to what extent and at what speed deliveries from China could resume," a ZF spokesperson said. "We are therefore continuing to work hard to secure our supply."

(Additional reporting by Ilona Wissenbach in Frankfurt, Editing by Miranda Murray and Emelia Sithole-Matarise)

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