Honda hit by chip trouble again, to pause car production in Japan and China

Honda, one of the biggest names in global mobility, is again feeling the heat of the auto-chip shortage, and this time the impact looks serious for Asia.  We have seen supply chain chaos before, but the fact that such a huge brand still cannot get enough "simple” car chips shows how unpredictable the auto industry has become.

As per reports by Digitimes, the company is now preparing to pause production both in Japan and China right at the beginning of the new year. I honestly find it wild how a tiny chip that controls basic car functions like wipers and power windows can bring giant factories to a halt. It also reminds me of chats with industry executives earlier this year who warned that older automotive chips are harder to replace than fancy new tech parts, and now we are watching that fear turn real.

Honda will stop vehicle production at several plants in Japan on January 5 and 6, with reduced output expected till January 9. The company has not officially named the exact plants, but industry estimates hint at major domestic production facilities likely being impacted. In China, the situation is no better. All three factories operated by Guangqi Honda Automobile will shut down from December 29 to January 2. Honda’s other China joint venture, Dongfeng Honda, so far seems unaffected, which shows how uneven and unpredictable this chip mess really is.

This fresh pause comes even after earlier expectations that disrupted production would recover. Instead, it signals that parts supply remains unstable. The semiconductor crisis here is tightly linked to Nexperia, a major supplier of legacy automotive chips. A long political and trade tussle involving China, the Netherlands, and earlier US pressure affected Nexperia’s exports from China. Even after Beijing briefly relaxed restrictions and the Dutch government softened its stance, full normalcy has clearly not returned.

Nexperia does not build advanced smartphone or AI chips like TSMC or Samsung. These are simpler, older chips, but they are absolutely lifeline components for cars. They run everyday systems like power steering controls, window motors, and wipers. Without them, you literally cannot finish building a car.

We saw German brands like Volkswagen and BMW slow down certain production lines earlier. Now Honda is back in the same storm. As a car enthusiast myself, I find it slightly heartbreaking to watch factories loaded with machines, workers, and fully built cars stuck only because of a missing piece smaller than a coin. But that is the reality of the supply chain in 2025.

Honda has already cut its global sales outlook to around 3.34 million units from an earlier target of 3.62 million units. North America earlier saw temporary factory pauses, and now Asia joins the list again. For buyers, this could mean longer waiting periods and possible pricing pressure in some markets. For the industry, it is another reminder that chip politics and manufacturing are now completely linked to global car production.