30 September 2023
Fact checkMisleading

Misleading: Video of prominent factories closure in China includes plants that are still in business

Two of the four factories are still operating, while the other two were reportedly shut down for losses incurred before the pandemic.

A video posted on Twitter on Feb. 25 claims a wave of unemployment is set to hit China as factories are closing one after another.

It featured abandoned factory plants in Guangdong and Fujian owned by prominent enterprises including BYD Auto, LG Innotek, and Lenovo, implying the closure was a result of the post-pandemic economic downturn.

Annie Lab looked into the clips and found two of the four featured plants were still in business while the other two were either closed or demolished for business reasons that may not be related to the pandemic, given their long-term lack of financial viability.

The misleading Twitter video was also reported by New Tang Dynasty Television and VCT News and picked up at least 500 likes and 200 shares.

Clip 1: BYD Auto factory in Shanwei, Guangdong (0:00 – 0:29)

The first clip referred to a “deserted” BYD plant in Shanwei in eastern Guangdong province. Keyword search with the term “Shanwei BYD factory” on Chinese social media platforms led us to the same video posted in 2021 on Toutiao, one of China’s biggest content aggregators.

The Toutiao video, which is much higher in resolution and length, came with a voice-over claiming “the glory days were gone for this empty factory.”

BYD owns three factories in Shanwei, namely the Luhe, Lufeng, and Hongcao plants, according to the company website. We can confirm the plant featured in the first clip was BYD’s Luhe plant.

From the video, we spotted a blue sign reading “Z9” and a concrete beam decorated with what seemed to be green leaves inside the production plant seven seconds into the clip.

A video screenshot (left) showing the “Z9” sign and other features that matched with the press photo (right) of BYD’s Luhe factory.

We can ascertain the plant’s location by matching interior features with a news photo published by the Shenzhen Commercial News on Dec. 27, 2018.

Screenshot of Shenzhen Commercial News article that featured the BYD plant

While the video claims the factory was closed due to depleting orders, we found that BYD Auto was still hiring for its three plants in Shanwei as of late March this year.

A screenshot of BYD’s recruiting page shows it was still hiring for its three Shanwei factories.

Clip 2: LG Innotek factory in Huizhou, Guangdong (0:29 – 1:00)

The second clip of the compiled video depicted an LG Innotek factory where a narrator said it was deserted for so long that there weren’t even security guards left watching the facility.

A keyword search of “LG Innotek China factory” in Chinese led us to a 2021 article indicating the Huizhou plant in Guangdong province was put on sale because it was not profitable.

We found the factory’s address from an industry information hub and cross-checked it with Baidu Map street view.

A screenshot (right) showing similar features of the LG Huizhou plant that matched with Baidu street view result (left).

We also tracked the original source of the LG clip to a video that was first uploaded to Xigua, a video-sharing site, in September 2020.

The two-minute-long Xigua video shows a vlogger discussing how the plant would soon be shut down.

The clip (left) was taken out from a video posted on Xigua in 2020 (right).

The LG Innotek project was set up in 2010, but reportedly, it has met fierce competition from Chinese LED manufacturers since 2014.

According to a 2021 article by the Seoul-based Herald Business (헤럴드경제), LG decided to terminate its LED production in 2020 and sell its Innotek production base in Huizhou. This was also subsequently cited in a Chinese article.

Clip 3: Lenovo factory in Xiamen, Fujian (1:00 – 1:50)

About a minute into the compiled video, the focus shifts to a Lenovo factory in Xiamen city in Fujian province. It claims the factory has gone bankrupt and left 20,000 employees jobless.

We found the same video published on Toutiao in December 2021 discussing the abandoned Xiamen Lenovo plant manufacturing mobile devices through a keyword search.

The clip in question (left) is identical to a 2021 Toutiao video (right).

In 2017, the China Economic Net reported that Lenovo’s mobile operation arm was in a bad shape and questioned its future.

On June 16, 2022, Xiamen’s Natural Resources and Planning Bureau approved the demolition of Lenovo’s Xiamen plant and  reconstruction proposal.

Reconstruction work began last September and is expected to finish by June 2024, according to construction site photos uploaded by a Xiamen-based Weibo user last month.

Clip 4: Dongguan Chitwing Technology in Guangdong (1:50 – 2:11)

The last clip shows Chitwing Technology’s factory in Changan township of Dongguan in Guangdong. It claimed the company has asked some employees to take leaves from February to May this year due to depleting orders.

The Chitwing’s notice shown in the video was also reported by news portal Jiemian on Feb. 25.

The video compilation shows a screenshot of Chitwing’s notice (left), which is identical to the one reported by Jiemian (right).

However, according to the article, a Jiemian news reporter visited the Chitwing factory in Chang’an Town on Feb. 24 and found the company was still recruiting general workers. Chitwing workers told Jiemian that non-production staff in administration and finance were ordered to go on leave.

The company’s 2022 performance forecast anticipated a financial loss of up to 450 million yuan (US$ 65 million), citing depleting post-pandemic demand for consumer electronic products and global inflation.

We also tracked the original video that was uploaded by a content creator to Xigua on Feb. 22, two days after the company had issued the leave notice.

People’s Daily also shared the Jiemian article on one of the platforms.

While China’s economy, including the manufacturing industry, was severely hit by COVID-19 in the past three years, factory activity resumed recently and reached the highest level in 11 years, after reopening from the zero-COVID policy.

Chinese Premier Li Qiang said the local economy was showing “strong momentum” under the challenging environment at the Boao Forum on March 30.