Volkswagen to exit China’s Xinjiang and sell factory – DW – 27.11.2024

German automaker Volkswagen (VW) announced Wednesday that it will sell its operations in China’s northwestern Xinjiang region.

China has been accused of numerous human rights abuses in the region, including re-education camps and forced labor targeting Uighurs and other minority groups.

What do we know about VW sales?

VW said it would sell its factory in the regional capital Urumqi and its test track in Turpan.

A company spokesperson stated that the decision was due to “economic reasons”.

VW grew slower in 2023 than in previous years, and the company fell behind its domestic rivals.

The company said it would extend its partnership with Chinese firm SAIC for a decade, until 2040.

The two companies said they would sell their facilities in Xinjiang to the SMVIC unit of the Shanghai Lingang Development group, which would also hire the factory’s workers.

The move comes as VW aims to close factories in its home country of Germany as well as lay off employees to cut costs.

European car companies are also gauging the effects of a potential trade war between Beijing and Brussels after the EU imposed high taxes on electric vehicles imported from China.

What are the human rights claims in Xinjiang?

The Uyghur people are a Turkic-speaking, predominantly Muslim ethnic group living in Xinjiang.

The region is also home to a smaller ethnic Kazakh and Kyrgyz minority.

Human rights organizations have accused China of holding more than a million people, mostly Uighurs, in “re-education camps” and using forced labor for detainees.

Last year, several activist groups filed a complaint in Paris targeting French and US companies, accusing them of being complicit in crimes against humanity in Xinjiang through their use of subcontractors in China.

sdi/msh (AFP, Reuters)