European carmakers face EU pressure to diversify chip suppliers

2026-05-21 20:41:00, Kosova & Bota CNA

The European Commission is preparing new binding measures aimed at reducing European carmakers' dependence on a single chip supplier, particularly from companies linked to China. Under a draft law expected to be presented on June 3, car companies would have to source chips from at least two suppliers in certain cases and take geopolitical risks into account in their procurement decisions.

The new measures are part of the revision of European legislation on semiconductors, known as the Chip Act 2, which aims to strengthen the technological sovereignty and economic security of the European Union.

The change comes after successive crises in the global chip supply chain, which hit the auto industry hard during and after the COVID-19 pandemic. According to European officials, major manufacturers such as Volkswagen, Stellantis and Renault have not taken sufficient measures to avoid dependence on single strategic suppliers.

One of the cases that alarmed Brussels was that of Nexperia, a Dutch chip manufacturer acquired by the Chinese company Wingtech in 2019. In late 2024, Wingtech was included in the US sanctions list due to suspicions about the military use of its technology, while the sanctions later affected Nexperia as well.

Following tensions between the US and China, Beijing banned exports of some chips made by Nexperia to China, causing immediate shortages in the European auto industry. Many manufacturers reportedly had only a few months' worth of stock, highlighting the weakness of the supply chain.

The European Commission's spokesperson for technological sovereignty, Thomas Regnier, stated that "sustainability and technological sovereignty are absolutely essential" when it comes to semiconductors.

However, experts warn that diversifying suppliers could increase costs for the industry, as many Chinese companies benefit from state subsidies that give them a market advantage. Despite this, Brussels seems determined that security of supply and strategic autonomy take precedence over economic cost./ CNA