Volkswagen, partners to recall 4.86 million vehicles in China over Takata airbags

Volkswagen delivered 3.98 million vehicles in China last year. (Reuters)
Updated 14 September 2017
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Volkswagen, partners to recall 4.86 million vehicles in China over Takata airbags

BEIJING/SHANGHAI: Volkswagen and its Chinese joint ventures FAW-Volkswagen and SAIC Volkswagen will recall 4.86 million vehicles in China due to potential issues with Takata Corp. air bags, a blow to the carmaker in the world’s largest auto market.
The recall comes after Chinese watchdogs asked the German automaker as well as General Motors and Daimler’s Mercedes-Benz to recall vehicles with Takata air bags earlier this year.
Official Chinese estimates show over 20 million cars in China had air bags made by Takata, which have been linked to at least 16 deaths and 180 injuries globally. The air bags have the potential to explode with too much force and spray shrapnel.
The defect led to the biggest recall in automotive history and eventual bankruptcy of the Japanese maker.
Volkswagen told Reuters in an e-mailed statement on Thursday that after discussions, Chinese authorities had concluded the fault could occur in rare cases when the air bag was deployed, “which may create a potential safety risk”.
“Acting upon advice from the Chinese safety authority, Volkswagen Group China therefore made this recall decision.”
The carmaker said it had not received any reports related to the issue affecting its vehicles globally, and that a parts analysis had found Takata air bag inflators – the suspected cause of the defect – were in “normal condition”.
China’s General Administration of Quality Supervision, Inspection and Quarantine said in a statement that VW China would recall 103,573 vehicles, FAW-Volkswagen 2.35 million vehicles and SAIC Volkswagen 2.4 million vehicles.
The watchdog said the recall would run from March next year into 2019.
Volkswagen said the carmaker and its Chinese partners would provide free air bag replacements on the recalled cars.
Volkswagen, which also owns the high-end Audi brand, is not the only carmaker hit by recalls in China related to Takata air bags.
As of the end of June this year, 24 out of 37 affected automakers had recalled 10.59 million vehicles. A further five had made plans to recall 1.26 million vehicles.
Volkswagen delivered 3.98 million vehicles in China last year, an increase of 12.2 percent on 2015, making it the biggest foreign automaker in the country.


China opens up finance sector to more foreign investment

Updated 20 July 2019
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China opens up finance sector to more foreign investment

  • China will remove shareholding limits on foreign ownership of securities, insurance and fund management firms in 2020
  • Beijing has long promised to further open up its economy to foreign business participation and investment

BEIJING: China lifted some restrictions on foreign investment in the financial sector Saturday, as the world’s second largest economy fights slowing growth at home and a damaging trade war with the US.
China will remove shareholding limits on foreign ownership of securities, insurance and fund management firms in 2020, a year earlier than originally planned, the Financial Stability and Development Committee said in a statement posted by the central bank Saturday.
Foreign investors will also be encouraged to set up wealth management firms, currency brokerages and pension management companies, the statement said.
Beijing has long promised to further open up its economy to foreign business participation and investment but has generally dragged its feet in implementing the moves — a major point of contention with Washington and Brussels.
Saturday’s announcement followed a Friday meeting chaired by economic czar Liu He where policymakers focused on tackling financial risk and financial contagion and pledged new steps to support growth, according to a state council statement.
Additional measures include scrapping entry barriers for foreign insurance companies like a requirement of 30 years of business operations and canceling a 25 percent equity cap on foreign ownership of insurance asset management firms.
Foreign owned credit rating agencies will also be allowed to evaluate a greater number of bond and debt types, the statement said.
US President Donald Trump has launched a damaging tariff war in an attempt to force Beijing to further open up its economy and limit what he calls its unfair trade practices.
The US and China have hit each other with punitive tariffs covering more than $360 billion in two-way trade.
Trump and Xi Jinping agreed to revive fractious trade negotiations when they met on the sidelines of the G20 summit in Japan on June 29 and top US and Chinese negotiators have held phone talks this month.