‘It’s a Big Issue’: Nissan & Mercedes Sound Alarm Over New Chip Crisis. What This Means for India

Just when you thought it was safe to buy a new car, the nightmare has returned.

But this isn’t the “slow” 2021-2023 shortage we all got used to. This is a sudden, politically-driven crisis that has top auto executives spooked.

Speaking at the Japan Mobility Show in Tokyo, the warnings were uncharacteristically blunt. Guillaume Cartier, Nissan’s Chief Performance Officer, didn’t mince words: “It’s not a small issue, it’s a big issue.” He admitted Nissan only has “full visibility” on its chip supply until the first week of November.

Miles away, Mercedes-Benz CEO Ola Kaellenius confirmed the panic, stating his company is aggressively “scouring around the world for alternative supply.”

These are not idle warnings. These are the public-facing signs of a new supply chain fire raging in the background. The last time this happened, Indian car buyers saw waiting periods for an XUV700 stretch to 18 months and “features” like infotainment screens vanish from new models.

As an analyst who has tracked the fragility of this supply chain for years, I can tell you: this new crisis is different, and in many ways, it’s worse. And it is going to hit the Indian car market, hard.

Here is the 1000-word expert breakdown of what is happening, why it’s a threat to your next car purchase, and which models are most at risk.

1. The “Nexperia Crisis”: What Is It and Why Is It Happening?

You have never heard of a company called Nexperia, but it is a vital cog in the global auto industry. This is what you need to know, explained simply.

• Who: Nexperia is a chipmaker that produces “ubiquitous” chips. They aren’t the super-advanced “brains” (like from NVIDIA), but the essential, everyday chips that manage everything from your car’s power windows to its battery management system. A single car uses hundreds of them.
• The Owner: Nexperia is owned by a Chinese company called Wingtech.
• The Problem: Nexperia has a major manufacturing plant in the Netherlands. In September, the Dutch government seized control of this plant, citing national security concerns. They are afraid that critical European chip technology could be transferred to Nexperia’s Chinese parent company, Wingtech.
• The Retaliation (The ‘Big Issue’): In an alleged tit-for-tat move, China has now reportedly banned the export of Nexperia’s finished products from its other plants, which are located in China.
• The Result: A massive, vital source of essential car chips has been choked off overnight. This isn’t a factory slowing down; this is a tap being turned off by a geopolitical war.

This is the “crisis” that Nissan and Mercedes-Benz are now sounding the alarm about.

2. ‘Authoritative’ Context: This Isn’t the 2021 Shortage. This is a Geopolitical Shockwave.

It is critical to understand the difference between this event and the last shortage. Our reporting and analysis show two fundamentally different problems.

The 2021-2023 “COVID” Shortage (The “Experience”):

• Cause: This was a simple capacity problem.
• How it worked: During COVID, car makers canceled chip orders, and chipmakers (like TSMC) gave that factory space to laptop, phone, and PlayStation makers. When the car market suddenly boomed, there was no factory space left.
• The “Feel”: It was a slow-moving problem of scarcity. Waiting periods grew long, but the supply, while thin, was still flowing.

The 2025 “Nexperia” Crisis (The “New Threat”):

• Cause: This is a geopolitical problem.
• How it works: This is not about capacity. This is about a trade war between China and Europe. The factories exist, but the governments are using them as weapons. A tap has been shut off instantly.
• The “Feel”: This is a supply shock. The impact is immediate. Automakers who relied on Nexperia (which is almost everyone) woke up one day to find a core supplier had vanished.

Why This Is Scarier (Authoritative Analysis): You can solve a capacity problem. You invest billions and build a new factory (which is what the world has been doing for 3 years). You cannot easily solve a geopolitical problem. This is a hostile, unpredictable trade war, and the auto industry is the first major hostage.

3. The Indian Impact: Why a Dutch-China Spat Hits Your Dealership in Delhi

Many Indian consumers operate under the (understandable) myth that “Made in India” cars are immune to global problems. As an industry expert, I must be clear: this is dangerously false.

A “Made in India” car, like a Tata Harrier or a Mahindra XUV700, is a globally-sourced product. Its engine parts may come from Germany, its steel from Korea, and its microchips from China, Taiwan, and the Netherlands. The modern car is a complex tapestry of a 1000+ chips.

Here is exactly how this crisis will hit the Indian buyer, based on our experience from the last shortage.

• 1. Waiting Periods Will Explode (Again). The number one pain point for Indian consumers is the waiting period. The only reason those waits finally came down in 2024 was because the supply chain (and production capacity) had normalized. This new crisis throws all that progress into the bin. Carmakers will have to halt production lines as they “scour the world” for alternatives, just as the Mercedes-Benz CEO said. The 18-month wait for top-end models is coming back.
• 2. Your New Car Will Get More Expensive. Period. This is not a guess. This is an economic guarantee. The second a major supplier like Nexperia is removed, every automaker on Earth (Nissan, Mercedes, Tata, Mahindra, Hyundai, all of them) will start a bidding war for the chips that are left from other suppliers. When demand is high (everyone) and supply is low (a major supplier is gone), prices skyrocket. That extra cost is not eaten by the manufacturer. It is passed directly on to you, the customer. The ₹20 Lakh car you were saving for will get a ₹50,000 “price adjustment” overnight.
• 3. Features Will Be “Deleted.” Remember this? It’s the most frustrating part. To keep assembly lines moving, companies will start “de-contenting” their cars. Get ready to hear this from your dealer:
  • “Sorry sir, the 360-degree camera is not available on this model.”
  • “The ADAS Level 2 features are only on the top model, and the wait is 12 months.”
  • “This batch has arrived without the large 12-inch touchscreen, but we can offer a smaller 8-inch one.”

4. Which Indian Cars are Most at Risk? (Expert Analysis)

High-Risk Category:

• Tech-Heavy SUVs & EVs: Think of the cars that are selling on “features.” The Tata Nexon EV, Mahindra XUV700 (with its panoramic display), and the Tata Safari/Harrier (with their ADAS functions). These models are packed with dozens of micro-controllers, sensors, and power management chips—exactly the kind of things Nexperia makes.
• The New Hyundai Venue (Launching Next Week): This car is a prime example of vulnerability. It’s launching with a new dual 12.3-inch panoramic display, ADAS Level 2, and 70+ connected car features. This tech-first strategy makes it extremely susceptible to this new supply shock.
• All European Luxury Cars: Mercedes-Benz, BMW, and Audi are on the front lines. Their cars use thousands of these chips. Expect prices to rise and waits to lengthen almost immediately.

Lower-Risk Category:

• Base Models: The absolute entry-level, “bare-bones” versions of cars (e.g., a Maruti Alto K10 LXi) are the most insulated, but they are not immune. Even they need basic chips to manage the engine, brakes (ABS), and airbags.

Final Authoritative Takeaway

This is not a drill. When the CEOs of two of the world’s largest automakers use words like “big issue” and “scouring the world,” they are telling their shareholders (and us) that the problem is already here and it is serious.

As an analyst monitoring this situation, my advice to the Indian consumer is to be prepared. If you are planning to buy a new, tech-loaded car in the next 6-12 months, your “buying experience” is about to change.

Be prepared for the return of endless waiting periods. Be prepared for sudden price hikes that feel unfair but are a direct result of this crisis. And be prepared to be flexible with the features you want.