Japan’s automotive industry has been warned of possible future shortages of semiconductors, after the Dutch government seized control of Nexperia BV, a Netherlands-based subsidiary of China’s Wingtech Technology Company. Toyota, Honda, and Nissan are now reviewing their sourcing strategies, while Germany’s Volkswagen and Ford have already been put on alert for potential chip shortages.

The Japan Automobile Manufacturers Association (JAMA) has issued a statement warning domestic electronic systems manufacturers that supplies from Nexperia could be disrupted in the coming months, potentially affecting vehicle production in the country.

The Dutch government seized operational control of Nexperia, formerly a unit of NXP Semiconductors, at the end of September, citing flaws in corporate governance. This has fueled trade tensions between China and the Netherlands, putting Nexperia in conflict with its Chinese parent company.

Wingtech recently warned investors of a potential cash flow squeeze if it fails to regain operational control of Nexperia, despite 280% surge in the company’s latest quarterly net profit. Wingtech confirmed in a filing that “Nexperia may face temporary downward pressure on revenue, profit, and cash flow” due to governance issues.

Nexperia has also warned its Japanese automotive customers that it can no longer guarantee supplies, forcing a number of Japanese electronics companies to look for alternative suppliers to mitigate any possible production disruption.

JAMA said in a statement: “The chips manufactured by the affected company are important parts used in electronic control units (ECUs). We recognise that this development could have a serious impact on the global production of our member companies. We hope that the countries involved will come to a prompt and practical solution.”