Ukraine War fallout: Luxury cars BMW and Audi shipments to China by train suspended

On Tuesday, German carmakers BMW and Audi, the luxe brand from Volkswagen said that they have suspended train shipments of these cars to China. The reason for suspension is the war on Ukraine. Although these cars are manufactured in China, hundreds of thousands of cars are also sent by rail and ship from Europe to China.

A spokesperson for BMW told Reuters that the automaker had stopped all train transports that passed through Russia, immediately after the war began. It was also mentioned that exports to China routinely were handled by ships. The spokesperson confirmed the news, which had earlier been reported by Nikkei.

A spokesperson for parent automaker Volkswagen also said that the automaker had acted proactively by suspending rail transports to and from China through the Trans-Siberian railway. This action took place immediately after the invasion of Ukraine by Russia. The spokesperson also said that they were looking at a possibility of rail transport through the Southern route in the near future.

Earlier in March, Audi had said that it was adjusting its manufacturing unit in Hungary, as a result of the war in Ukraine. This factory rolls out a huge amount of the company’s exports.

China is the largest car market in the world for these luxury cars that sell in high numbers. In 2021, 846,237 BMW and MINI vehicles had been delivered to Chinese customers. In the same year, Audi had delivered 701,289 Audi vehicles to Chinese customers.

BMW has a joint venture in Shenyang. However, the number of luxury cars manufactured in the factory have been less than the demand and cars have been imported to China, through the years.

The suspension will create difficulties for both customers and the companies who do brisk trade with China. The rail route is much faster, more reliable and had less disruptions as well as a lower carbon footprint.

Transport to Kazakhstan and other Central Asian republics is being routed through an alternate train route. BMW said that it is using this train route which passes through the Balkans, the Caucasus and Turkey.

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