Toyota unaffected by Nexperia export restrictions, CEO confirms

Toyota CEO Koji Sato said today that the company does not face any immediate risk of semiconductor shortage following China’s export restrictions on Nexperia. He added that Toyota will proceed with the Toyota Industries buyout plan.

Sato made his remarks amid escalating tensions between the Netherlands and China over control of Nexperia B.V., a semiconductor manufacturer owned by China’s Wingtech Technology. The imposed control has prompted global automakers to reassess supply shortages. 

Global auto sector on alert as Nexperia export ban threatens chip pipeline

The Dutch government recently invoked a 1952 law to seize Nexperia on national grounds that bars the company from changing its management assets or IP for one year. China retaliated with an export ban on certain Nexperia products and components on October 4, halting shipments from its Chinese subsidiaries and subcontractors. 

Automakers have raised concerns over the shortage of power management chips and microcontrollers used in electric vehicles and hybrid systems. Sato explained that the Japanese automaker is working to standardize traditional chips to avoid the shortages that often arise during a pandemic.  

If standardized, it would reduce dependency on highly customized semiconductors, which have exposed car manufacturers to shortages during crises such as the 2019 COVID-19 pandemic. Nissan Motor Co., for instance, revealed that it only has a supply that could last until the first week of November, meaning extended restrictions could impact it negatively. 

During his remarks at the motor show in Japan, Sato reaffirmed Toyota’s plan to proceed with the buyout of Toyota Industries. In June, the automaker proposed a $108.10 per share deal to investors to consolidate Toyota Industries, which manufactures forklifts. The deal aimed to consolidate the forklift manufacturer under a new holding company jointly backed by Toyota Motor, Toyota Fudosan, and Toyota Chairman Akio Toyoda. 

Investors have urged Toyota to revise the price below the share price recorded just before the announcement. Asset managers have also raised concerns that the bid undervalues the company. Sato, in his response, said that the firm’s guiding principle is transparency and fairness, so they will proceed in a way that ensures understanding across all the stakeholders rather than rushing the process. 

Toyota’s structural overhaul targets EV growth and supply chain stability

The Japanese automaker is restructuring its strategy to strengthen internal synergies. The automaker intends to secure supply chains and improve group efficiency by focusing on EVs and innovative mobility technologies. 

The ongoing geopolitical tensions have also prompted similar restrictions between the U.S. and Japan, which target advanced chip production equipment and components. Clara Huang, a Japan Center for Economic Studies senior, revealed that the auto industry now sits at an intersection of geopolitics and industrial policy. 

Cryptopolitan noted yesterday that the chip shortage crisis has already caught up with Germany. According to an Ifo analysis report, Germany’s chip industry already faces shortages of rare-earth materials, which form a key part of the technology and automotive sector. Ifo revealed that 10.4% of companies in Germany’s electronic and optical sectors reported raw material shortages in October, up from 7% in July and barely 4% in April.

Across the entire manufacturing sector in Germany, approximately 5.5% of companies face shortages in raw materials, particularly in high-tech and precision industries. This poses a concern for automakers globally, which rely on advanced electronics for electric and autonomous vehicle production. 

Toyota stock price is up 1.24% following today’s announcement, trading at 3185 JPY at the time of publication. The firm has also maintained a positive YTD, currently standing above 5%. 

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