Of course, it also means significant dependence on a country with which Europe’s relations are increasingly strained.

Volkswagen, Audi’s parent company, illustrates the risks of relying on authoritarian states. The group relies on China for at least half its annual net profits, according to the Financial Times. And it has consistently defended its operations in Xinjiang, where China is accused of carrying out human rights abuses on a massive scale.

That’s now an increasingly difficult position for Volkswagen. In May, the German government denied the group investment guarantees for projects in China over human rights concerns. Earlier this month, Germany’s largest trade union questioned the company’s continued presence in Xinjiang. A major shareholder has also called on the firm to scrutinize the human rights abuse allegations.

Despite European automakers’ recent announcements, the tide may well be slowly turning against businesses’ heavy dependence on China.

“It’s a bellwether for a bigger change that’s coming,” says Gregor Sebastian, an analyst at the German think tank Mercator Institute for China Studies (MERICS), referring to the rejection of investment guarantees for Volkswagen. “This automatism that what is good for [German businesses] abroad is good for Germany at home—I think that’s gone.”

Meanwhile, disruptions from China’s zero-covid policies are forcing firms to reconsider their operations there. A recent survey by the European Chamber of Commerce showed that nearly one in four European firms are considering shifting out of China (pdf, p.12).

But for now, money talks. And for Germany’s carmaking trio, there’s a lot of money still to be made in China.

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