Volkswagen to ensure compliance with China data privacy rules

Volkswagen AG will ensure it is fully compliant with China’s “tough" new rules around data protection, which has ensnared companies from ride-hailing giant Didi Global Inc. to Tencent Holdings Ltd.

Automakers are at risk of being caught up in China’s data-security crackdown because electric and self-driving cars generate a treasure-trove of data including information about popular destinations and the routes taken to get there. Already, Tesla Inc. cars have been banned from military sites because of concerns their in-built cameras can collect sensitive data.

VW is “closely observing" the new regulations, “which are not only about electric vehicles, but also how we as a company have to deal with data protection for customers," China CEO Stephan Wollenstein, said during a briefing on the automaker’s first-half sales.

The German-based company will adjust its organizational structure to make sure it is “fully compliant" with the regulations, “which are pretty tough," Wollenstein said, without providing further detail.

In highlights from the sales report:

• VW delivered 1.84 million cars in the six months ended June 30, a 16% increase from a year earlier
• It held on to the No. 1 spot in the world’s biggest auto market, with an 18% market share
• It delivered more than 2,900 of its new ID.4 electric sports utility vehicle in June. Tesla, which sold 28,138 locally built EVs last month, last week unveiled a cheaper standard-range Model Y SUV, which will compete head-to-head with VW’s ID range
• Total sales of the five-model ID range, including one to be released later this year, should reach 80,000 to 100,000 vehicles by the end of the year

The current quarter “remains dynamic and hard to predict," Wollenstein said. Fresh Covid outbreaks across Asia are forcing semiconductor factories to close, exacerbating a shortage of chips that has crunched global automakers.

“We hope the chip supply crisis will bottom out this summer and expect to see an improvement in this situation within the second half of the year," he said. “However, the global chip shortage will continue into 2022, albeit, hopefully, in a weakened form."