Honda reportedly pauses production in Mexico due to chip shortage

By Alimat Aliyeva

Honda Motor Co. Ltd. has temporarily suspended its manufacturing operations in Mexico due to ongoing semiconductor shortages, Nikkei reported on Wednesday. The duration of the production halt remains unclear. The shortage stems from a dispute involving Nexperia B.V., a Dutch semiconductor manufacturer, Azernews reports, citing foreign media.

The situation began in April when the U.S. Bureau of Industry and Security (BIS) introduced a new rule for its Entity List, stipulating that any company “at least 50% owned by one or more listed entities” automatically falls under the same export restrictions. In 2019, China-based Wingtech Technologies acquired Nexperia. When Wingtech was added to the BIS Entity List in 2024, Nexperia also became subject to U.S. export controls under the new rule.

In September 2025, the Dutch government intervened, attempting to regain control of Nexperia to secure its semiconductor supply chain. Meanwhile, in October, China prohibited Nexperia’s Chinese unit from exporting components abroad. Reports indicate that Nexperia’s Chinese management instructed staff to ignore directives from the Netherlands, further complicating the situation for global clients like Honda.

Industry analysts warn that the dispute highlights the fragility of global semiconductor supply chains, where geopolitical tensions can ripple through manufacturing networks, affecting automakers worldwide.