A view of the plant of German carmaker Volkswagen in Osnabrueck, Germany.
Photo: Reuters
Chinese officials and automakers are eyeing German factories slated for closure and are particularly interested in Volkswagen's sites, opens new tab, a person with knowledge of Chinese government thinking told Reuters.
Buying a factory would allow China to build influence in Germany's prized auto industry, home to some of the oldest and most prestigious car brands, the person said.
Chinese companies have invested across a range of industries in Europe's biggest economy, from telecommunications to robotics, but have yet to set up traditional car manufacturing there despite Mercedes-Benz having two large Chinese shareholders.
Building cars in Germany for sale in Europe would allow China's EV makers to avoid paying EU tariffs on electric cars imported from China and could pose a further threat to European manufacturers' competitiveness.
Investment decisions would hinge on the new German government's stance towards China after an election in February, the person said.
Volkswagen is exploring alternative uses for its Dresden and Osnabrueck factories under a cost-cutting drive to pare back its German operations. Europe's biggest automaker, which owns brands including Porsche, Audi and Skoda, has suffered a fall in sales in the face of rising competition from Chinese companies.
VW executives wanted to close several plants but faced resistance from unions. In a deal struck before Christmas they agreed to end production in Dresden, a 340-worker plant making the electric ID.3, from 2025, and Osnabrueck, where 2,300 employees produce the T-Roc Cabrio, from 2027.
VW would be open to selling the Osnabrueck factory to a Chinese buyer, a person familiar with the company's thinking told Reuters.
"We are committed to finding a continued use for the site. The goal must be a viable solution that takes into account the interests of the company and employees," a spokesperson said, declining to comment specifically on speculation about an offer.
Many Chinese carmakers are scouting locations for plants in Europe, the world's second-largest EV market, to circumvent tariffs imposed by the European Commission last year to counter what it said were unfair subsidies in China.
Chinese investors have already surveyed plants in Western Europe, according to a separate source familiar with those discussions, including Ford's, opens new tab plant in Saarlouis in Germany and Volkswagen's Audi plant in Brussels.
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