- Deutsche Bahn’s recent bulk order of electric buses from BYD sparks a heated labor dispute.
- Critics label the purchase decision a “bad joke,” citing concerns over domestic industry and worker loyalty.
- Despite political pressure for local sourcing, Deutsche Bahn opts heavily for Chinese manufacturers through European subsidiaries.
- BYD, a major player in electric buses, operates a U.S. plant but still faces challenges assimilating into Western markets.
- Union leaders vow to bring the controversy before Deutsche Bahn’s supervisory board, escalating tensions.
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The recent announcement of Deutsche Bahn’s considerable electric bus procurement from BYD, a Chinese manufacturer, has sparked outrage from EVG [stands for Eisenbahn- und Verkehrsgewerkschaft, the Railway and Transport Union in Germany], the key labor union representing railway workers. The main gripe? A perceived threat to domestic employment and a failure to uphold the government’s call for economic nationalism.
EVG’s leader, Martin Burkert, wasted no time declaring the purchase a “bad joke”. This blunt criticism encapsulates growing concerns about multinational supply chains overrunning local industry. Burkert highlighted the dissonance between the government’s recent exhortation for “location patriotism” and Deutsche Bahn’s decision to pursue cheaper, foreign-made buses.
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The union’s forceful objection serves as a reminder that procurement practices in public transportation are not merely transactions—they are also political statements with social consequences.
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Behind the headline tension lies a complex web of procurement rules, subsidiary dynamics, and geopolitical considerations. Deutsche Bahn’s decision to engage BYD does not equate to a direct Chinese purchase. Instead, contracts are funneled through BYD’s European subsidiaries, enabling them to compete under EU regulations ... Crucially, this procurement channeling is what allows these Chinese-origin companies to bypass outright exclusion, despite increasing political skepticism about Chinese industrial influence.
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Yet this arrangement spots scrutinizers in the union and political spheres who emphasize that true “local sourcing” must go beyond legal technicalities. Public sentiment often equates such purchases with foreign imports, especially given media narratives about economic competition with China. This perception puts public pressure on political leaders to reassess procurement guidelines and possible protections for domestic manufacturers.
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BYD’s journey shows the complexities of confronting skepticism around foreign ownership and geopolitical concerns. In the U.S., the company has faced investigations around national security concerns tied to Chinese Communist Party links and came under scrutiny as the Senate debated legislation to restrict federal funds from supporting Chinese-owned manufacturing firms.
These hurdles underscore the broader challenges non-Western companies face when trying to embed themselves in Western infrastructure projects, especially in sectors as sensitive as public transportation. BYD’s efforts to comply with “buy American” rules by employing hundreds of American union workers and sourcing components locally demonstrate a bid to mitigate these concerns.
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This [union's] approach combines hard-hitting rhetoric, such as labeling the BYD purchase a “bad joke,” with detailed advocacy for increased domestic procurement to protect European workers. They also seek to forge alliances with political leaders to introduce stricter guidelines favoring local manufacturers in future tenders.
Key elements of this strategy include pushing for:
- Clearer definitions of ‘local content’ in public contracts to exclude loopholes exploited by subsidiaries of foreign firms.
- Increased transparency requirements for manufacturers bidding on sensitive infrastructure orders.
- Strengthening labor protections and safeguarding union jobs within evolving green transport industries.
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Addition: To provide a broader picture: DB will be ordering around 3,300 busses over the next years with the main supplier being Germany's MAN. China's BYD is supposed to deliver a few hundreds.