Volkswagen Faces Allegations Of Chinese Forced Labour In Xinjiang

In response to recent accusations of violations of human rights, German carmaker Volkswagen announced on Wednesday that it was debating the continuation of its operations in China's troubled Xinjiang region.

A test track in Turpan, Xinjiang, may have been constructed in 2019 using forced labor, according to a report published in the financial daily Handelsblatt. VW however declared that it had not seen any proof of human rights abuses related to the project, but it promised to look into any fresh information that surfaced.

Moreover, VW said that it was in discussions "about the future direction of business activities in Xinjiang" with its Chinese joint venture partner SAIC, which appears to be a reflection of the mounting pressure on the group regarding its presence in the area.

VW released a statement saying, "Various scenarios are currently being intensively examined."

Volkswagen and its Chinese partner SAIC may have used forced labor to build a test track in Turpan, according to Handelsblatt, which cited testimony from VW workers and findings from Adrian Zenz, head of China studies at the nonprofit Victims of Communism. 

According to Handelsblatt, Zenz directed attention to details on the website of the company that constructed the test track for Volkswagen and SAIC, which included pictures of Uyghur laborers at the location dressed in Chinese military garb.

When the track was being built, Uyghurs were being forced to labor as part of what the government claimed were efforts to alleviate poverty. This forced labor ended in 2019.

Additionally, Volkswagen and SAIC share a small factory in Urumqi, Xinjiang. The plant doesn't produce any automobiles. Its 197 employees, including Uyghurs, make final quality checks on cars that have already been assembled before sending them to dealerships in the area.
Minorities make up 24% of the workforce. VW has a contractual obligation to continue participating in site operations through 2029.

Volkswagen told Handelsblatt that, in response to investor pressure, it hired an outside audit of the plant last year. However, due to ownership arrangements with other companies, a test track review was not feasible.