(Yicai) Aug. 27 -- China’s Changzhou Xingyu Automotive Lighting System has issued an apology after the news that the developer of vehicle lamps terminated contracts with more than 100 fresh graduates broke out.

“After review, the management acknowledges that there were decision-making errors and management oversights and that the communication during the execution was harsh and methods were simplistic, failing to consider the immediate interests of the students,” Xingyu said in an apology letter yesterday.

The company pledged to provide the laid-off graduates with free accommodation and job-seeking subsidies for three months, which could be extended to six months if they do not find a new job in the period.

Xingyu hired a large number of master’s degree students who would graduate this year during last year’s autumn recruitment, National Business Daily reported. But on Aug. 8, the firm’s human resources department informed them they should either resign or be reassigned to frontline positions, citing poor market conditions and operational issues.

Xingyu has recruited a total of 440 graduates from the 2026 class, of whom 107 had their labor contract terminated, according to a report released by Changzhou’s HR and social security bureau on Aug. 25. The methods used during the negotiation process were simplistic and harsh, and communication was insufficient. The company has apologized, and the HR director was suspended, the report noted.

Recordings provided by the graduates showed that during the resignation persuasion process, Xingyu threatened them that their future background checks would remain untouched only if they voluntarily resigned. Ultimately, about 70 percent of them, equal to nearly 300 individuals, chose to sign the resignation papers, the graduates claimed.

Founded in 1993 and listed on the Shanghai Stock Exchange in 2011, Xingyu is pursuing a secondary listing on the Hong Kong Stock Exchange. According to the prospectus, its revenue grew from CNY10.2 billion (USD1.5 billion) in 2023 to CNY15.3 billion in 2025, with the annual growth rate down from 24 percent to 15 percent in the period. In the first quarter, revenue rose 11 percent to CNY3.4 billion (USD510 million) from a year earlier.

Xingyu’s overseas sales surged 27 percent to CNY634 million (USD94.3 million) in 2025 from the previous year, as it ramps up production at its factory in Serbia. However, the gross profit margin of the company’s overseas business was only 3.7 percent, compared with the 21.1 percent gross profit margin of its domestic business.

According to statistics from Frost & Sullivan, Xingyu was China’s top automobile lamp maker last year, holding an 11.6 percent share of the market. The company supplies nine of the world’s top 10 carmakers.

Editor: Futura Costaglione