Russia Freezing Volkswagen’s Assets Should Be A Warning

Perhaps doing business in authoritarian countries was always a bad idea.

To the shock only of those who are asleep, a Russian court has frozen all Volkswagen assets in the country, striking a major blow against the German automaker. One might attribute this move to hurt feelings still festering from two world wars, but the truth is far more troubling. However, most people won’t learn anything from the situation, setting them up for a horrible downfall in the near future.

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Everything went sideways when the Ukraine War fired up and VW, like many other countries, decided to sever ties with Russia out of principle. After suspending operations in the country in 2022 and since has been trying to sell off assets there, including its largest plant capable of churning out 225,000 cars annually. All that has been stopped dead thanks to GAZ, a Russian automaker which was making VWs.

Somewhat similar to how in China virtually all foreign automakers must partner with a domestic company, Volkswagen and GAZ were tied at the hip. If you didn’t already guess, this is the kind of fate automakers and other companies doing business in China can look forward to when, not if, the Middle Kingdom strikes Taiwan.

If you think for a moment the Chinese Communist Party will play nice and honor foreigners’ property rights, let alone allow foreigners to waltz out of the country once an act of war is declared, you’ve been consuming too much propaganda distributed by the communists.

In the meantime, thanks to the lure of making big money, automakers continue to churn out vehicles under the watch of an oppressive Marxist-Leninist regime. It’s all too similar to how Ford and GM provided plenty of trucks to Germany in the 1930s, which were then used against the Allies during WWII as the Third Reich seized foreign assets to fuel the war effort. As Mark Twain once said, history doesn’t repeat itself, but it does often rhyme.

Sources: Reuters, Washington Post

Images via Volkswagen Group