China To Relieve Looming Chip Shortage By Opening Up Exports To Some Companies

Happy Monday! It’s November 3, 2025, and this is The Morning Shift — your daily roundup of the top automotive headlines from around the world, in one place. This is where you’ll find the most important stories that are shaping the way Americans drive and get around.

In this morning’s edition, we’re looking at a break for companies hit by the new chip shortage, as well as the state of affairs at ZF. We’ll also look at Tesla’s continued downward spiral in Europe, and how the end of the U.S. EV tax credit hit our Korean automakers. 

A new chip shortage has been looming over the global automotive market, going so far as to shut down American Honda production due to lack of parts supply. Now, though, it seems like there’s a chance for some companies to get chips again — but only a chance. From Automotive News:

China said it will allow companies deemed eligible to be exempted from its export ban on Nexperia’s semiconductor chips, a spokesperson for the Ministry of Commerce said Nov. 1 in a statement.

The statement was made after China’s export ban on the Dutch semiconductor chip supplier forced Honda Motor Co. to suspend production in North America and spurred other global automakers to warn of imminent chip supply shortages

…

The ministry didn’t specify when the exceptions would be granted or take effect.

It sounds like the Trump administration wants to take credit here, after trade negotiations with China, but this announcement has no details on which companies will be allowed to get chips from Nexperia — let alone how many chips, or when they’ll be made available. There are plenty of questions that still need answers. 

Last week ZF cut output of its components thanks to the chip shortage. This week, things are getting worse. The company has now announced it plans to furlough workers, though it hasn’t yet announced how many. From Reuters:

German auto parts supplier ZF (ZFF.UL) is planning to furlough workers at its Schweinfurt site due to a limited supply of semiconductors, a union representative said.

“The specific arrangements are currently being negotiated with the works council,” an IG Metall union representative told Reuters.

The company did not immediately respond to an emailed request for comment.

A stand-off over Dutch chipmaker Nexperia has led to concerns of possible production stoppages for carmakers, with the chips used widely by their suppliers like ZF

The union likely isn’t going to want any of its workers furloughed, especially with this new announcement that chips could be making their way back to businesses soon. We’ll have to see where the situation goes from here, but it could be on its way to a resolution — if a later one that companies and workers would like. 

Tesla has been really struggling in Europe, thanks to a combination of the company’s aging lineup and its CEO’s politics — a set of opinions that are far to the right in the United States, itself a nation far to the right of most of Europe. Fewer and fewer people are willing to shell out for a dated vehicle so deeply associated with Musk over in the EU. From Reuters:

Tesla’s sales plunged in October in a number of European countries including Spain, the Netherlands and Nordic markets in the latest sign that the U.S. electric vehicle maker’s struggles on the continent continue.

Tesla had seen sales rise in a number of European markets in September, after falling for most of this year due to increasing competition to its ageing lineup from newer EV models.

The automaker’s new car registrations – a proxy for sales – dropped 89% in Sweden, 86% in Denmark, 50% in Norway and 48% in the Netherlands, local industry data showed. Its sales in Spain were down 31% in October, while industry-wide sales of fully-electric and plug-in hybrid models jumped 119%.

Seems bad, Elon! Good thing you canceled the affordable car to focus on the Cybertruck and autonomous taxi. Surely these are better investments of time, money, and effort. 

Hyundai and Kia make some fantastic EVs, but those EVs just lost a major selling point in the U.S.: Their tax credit. Now, predictably, sales of the Ioniq 5, Ioniq 6, EV6, and EV9 are down. From Automotive News:

U.S. sales fell at Hyundai and edged up slightly at Kia in October as electric vehicle demand slumped following the expiration of federal tax credits.

…

While hybrid deliveries jumped 41 percent, sales of two of Hyundai’s core EVs ― the Ioniq 5, down 63 percent, and Ioniq 6, off 52 percent ― fell sharply. Kia’s topselling EVs, the EV6 and EV9, saw even steeper declines last month.

“We saw strong EV demand leading up to the expiration of federal tax credits, and while that shift has temporarily disrupted the market, we’re confident it will reset,” Randy Parker, CEO of Hyundai Motor North America, said in a statement. “Hyundai’s momentum remains strong, and we’re on pace for record retail and total sales for the year.”

Hyundai has to sound confident here, because that’s what investors want to hear, but the loss of the EV tax credit is a major blow to companies that produce EVs. It’s also a major blow to anyone who wants a breathable atmosphere to remain around a habitable planet, but I guess we’re not doing anything about that one. 

I don’t want to think about this past weekend’s World Series. I will die for my country, the east coast. 

Can you believe we’ve only had Chvrches as our On The Radio gear a measly one time? That needs to change.