Covid halts VW production + Media balancing act over Ukraine • China.Table

Covid situation intensifies – factories at a standstill
State media avoid the taboo word ‘war’
Top Chinese and US diplomats meet
Stock prices in free fall
Coal production to increase by 300 million tons
EU gets new public procurement law
State-owned enterprises are to invest in Xinjiang
Hong Kong threatens imprisonment under security law
Opinion: Ukraine is Beijing’s central quandary

Dear reader,

Until now, China’s zero-covid strategy has been considered highly successful. With strict lockdowns, large-scale mass testing, and digital tracing, it seemed like the government in Beijing could keep Covid under control. But as recent developments in Hong Kong have indicated, Covid is now spreading to the mainland, with the number of new infections rising rapidly across the country.

Companies like Volkswagen or iPhone supplier Foxconn were forced to halt their production. At first, only for the next few days. But if the Covid numbers continue to rise, it might be the end of China’s zero Covid strategy, our team in Beijing predicts. And that’s not all: China’s new growth target, and ultimately, international trade could be thrown into severe turmoil as a result.

Meanwhile, the war in Ukraine rages on. While any critical reports on the invasion have been made punishable in Russia, we look at how the People’s Republic is reporting on the behavior of its “strategic partner”. Julia Weibel reveals how China’s state media manage to turn a Russian invasion into a US “blood debt” to China. And once again, China’s Internet users display remarkable creativity. With imaginative play-on-words, they manage to express their sympathy and concern.

Your
Michael Radunski

Feature

Covid outbreaks: VW has to stop production

The FAW-Volkswagen plant in Changchun will remain closed over the coming days.

Both Volkswagen and Apple supplier Foxconn were forced to halt parts of their production in China for several days. The Corona situation is tenser than it has been since the Wuhan outbreak.

For the longest time, it looked as if China could keep Covid out thanks to its strict safety measures. Even when the far more contagious Omicron variant was first found in Chinese cities at the beginning of January, authorities initially managed to contain the outbreaks. But now 19 regions are simultaneously reporting new outbreaks. And with Changchun in the north and Shenzhen in the far south, two metropolises that are important for the economy have been placed under lockdown.

This also affects Volkswagen: The group is forced to temporarily halt production at three of its plants due to the lockdown in Changchun. The plants, which are jointly operated with the Chinese partner FAW, are to remain closed till Wednesday by order of the authorities, explained a VW spokeswoman in Beijing. A VW plant, an Audi plant and a components plant are affected.

According to the spokeswoman, the closure does not automatically mean that fewer vehicles will be built. The stoppages could be compensated later, for example with extra shifts, if there is no prolonged production shutdown. However, the exact definition of the term “prolonged” remained unclear.

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