Volkswagen sells its car plant in Xinjiang, citing ‘economic reasons’

Volkswagen has sold its plant in Xinjiang, a region in northwestern China beset by accusations of human rights abuses, citing “economic reasons.”

Volkswagen has sold its plant in Xinjiang, a region in northwestern China beset by accusations of human rights abuses, citing “economic reasons.” “There is no business case for (the plant),” said a spokesperson, noting that it produced combustion engine vehicles until 2019 and, since then, has effectively operated as a distribution center for models produced in other factories. Citing “huge pressure” from rival carmakers that churn out electric vehicles, the spokesperson said Volkswagen needs “to accelerate the transformation of (its) production network” and that “demand for combustion engine vehicles is going down.” Sales of electric cars are rising in many countries and, in China, they could account for 45% of all car sales this year, according to the International Energy Agency. The German automaker announced the sale of the facility, which it owns as part of a joint venture with China’s SAIC Motor, in a press release Wednesday. The sale comes after the US government and human rights groups have, for years, accused China of using forced labor and committing other abuses, such as mass detentions, in Xinjiang against the Uyghur Muslim minority group.