Volkswagen may have used forced Uyghur Muslim labour in China factory

Auditors investigating Volkswagen for using Uyghur Muslims as forced or interned labour at their factory in Xinjiang say they found no evidence to corroborate the claim. However, they also pointed out that data collection in China, which was the basis of such investigations, is challenging in its own unique way, a Reuters report said.

Volkswagen has been accused of using interned Uyghur Muslims, who have been forced to undergo reeducation and retraining as “ideal Chinese citizens,” at their Xinjiang factory for years now. Volkswagen has always denied knowledge of any use of forced labour in Xinjiang.

Earlier this year, Volkswagen investors demanded the carmaker to seek clarification from SAIC Motor, their partners in China, and sought to conduct an independent audit of the labour conditions at its site in Xinjiang.

This move came in response to documented abuses, including mass forced labour in detention camps, in the region, and the fact that Volkswagen’s shares were dropped by major investors following the US rating agency MSCI issuing a “Red Flag” rating to the car major.

Sham audit?
Investors, including Union Investment, have urged Volkswagen to address the allegations convincingly by the end of the year.

However, there are several indicators which suggest that the audit was done hastily and based on compromised data. The audit, conducted by the German human rights due diligence firm Loening Human Rights & Responsible Business GmbH, involved comprehensive on-site assessments, as per the aforementioned Reuters report.

This process included interviews with personnel and a thorough examination of employee contracts and salary payments for the 197 individuals employed at the site, among other things. However, during the auditing process, Loening had to be accompanied by two local Chinese lawyers, Reuters reported.

So flawed was the method that even though Loening found no evidence of the factory usig interned labour, they were quick to add that data collection and conducting such investigations were uniquely challenging in their own way.

“Directly plausible that Volkswagen could have hired Uyghurs”
As per a report by Table Media, investigations by Chinese researcher and anthropologist Adrian Zenz reveal close ties between the joint venture of Volkswagen and state manufacturer SAIC and the Xinjiang Industry Technical College in Urumqi.

This educational institution in the Toutunhe district reportedly serves as a reeducation and reorientation centre for Uyghur Muslims, aimed at shaping them into ideal Chinese citizens after they have been separated from their families, claims Zenz.

The Xinjiang Industry Technical College offers a degree in automotive production, listing Volkswagen as one of the companies where graduates typically find employment.

Zenz suggests that it is “directly plausible” that Volkswagen could have hired Uyghurs who were interned in reeducation camps. The college, which collaborates with companies for vocational education through research integration, allegedly involves Volkswagen, as indicated on the college’s website.

Shades of grey, shadow of doubt
While there is no definitive proof that Volkswagen employs former inmates of internment camps, the German automaker is awfully close to state-sponsored, systematic forced labour programs.

A Volkswagen spokesperson told Table Media that they are unaware of any collaboration with the college, citing a “hiring freeze at the factory” that has been in place for years. The spokesperson did not provide further details initially.

Adrian Zenz emphasizes the proximity of Volkswagen to human rights abuses, stating that any company operating in the region faces the fundamental problem that it is only a matter of time until they are directly affected.

Zenz’s research indicates instances where Uyghurs from internment camps are immediately placed into vocational training, including educational institutions preparing students for work in companies like Volkswagen, which needs the US rating agency MSCI to withdraw its “Red Flag” rating its social issue category. MSCI had disqualified Volkswagen shares due to its involvement in Xinjiang.

Why is Volkswagen being complacent?
While the company asserts the absence of forced labour, critics argue that the facility serves as a powerful symbol for the Chinese government, showcasing prosperity in the region.

The intensifying scrutiny of Volkswagen’s presence in Xinjiang aligns with a changing geopolitical and economic landscape. This presents a dilemma for Volkswagen, as it remains reliant on business in China, accounting for 15 per cent of its pretax profit and 37 per cent of its new car sales last year, as per financial filings by the VAG group for Southeast Asia.

The evolving geopolitical dynamic is forcing the company to navigate a complex landscape with implications for its operations and more importantly, its reputation, globally.