After new allegations of possible human rights violations in China, the VW Group is reacting: It is negotiating with its partner SAIC about the future of the plant in Xinjiang province. BASF had previously withdrawn from the region.
After the chemical company BASF, Volkswagen is also examining a reorganization of its business in the Chinese region of Xinjiang. The background is reports of possible human rights violations. “The Volkswagen Group is currently in discussions with the non-controlled SAIC-Volkswagen joint venture about the future direction of business activities in the Xinjiang province,” a company spokesman told the dpa news agency. “Various scenarios are currently being intensively examined.”
When asked, the spokesman left it open whether a withdrawal from the region was also under discussion. There is no comment on the content of the ongoing discussions.
working conditions were investigated
The VW Urumqi location, which opened in 2013, has been criticized for possible human rights violations in the province inhabited by Uighurs. In the summer, the car company commissioned a company to examine the working conditions at the controversial plant in Xinjiang for human rights violations. The auditors announced in December that they had been unable to find any evidence or evidence of forced labor among employees.
VW had previously pointed out that the Urumqi plant in Xinjiang was a joint venture with the Chinese partner SAIC, in which the partner had the majority control. The contract actually runs until 2029.
Fund provider withdraws from VW investments
The fund provider Union Investment responded to the allegations. He is withdrawing from VW investments in his sustainable public fund, as a spokesman announced. The allegations against the car manufacturer have a new dimension, said portfolio manager Janne Werning, with a view to possible forced labor. “This means that Volkswagen is no longer investable for our sustainable public funds.”
The chemical company BASF had already announced on Friday that it would sell shares in its two joint ventures in Korla, China, in the center of the Xinjiang region, and also referred to recent reports of possible human rights violations. Several politicians then asked Volkswagen to do the same.
Car production was stopped in Urumqi
According to previous VW information, the Urumqi location only has around 197 employees who only prepare vehicles for delivery. Car production has now stopped at the site and the number of employees has been reduced from 650 to under 200.
Volkswagen recently said at the beginning of February that it was taking its responsibility as a company in the area of human rights very seriously worldwide – including in China. The UN Guiding Principles on Business and Human Rights are adhered to closely.
Uighurs, members of other minorities and human rights organizations have been reporting for years that hundreds of thousands of people in Xinjiang are being put into re-education camps against their will, in some cases tortured and forced into forced labor. The Chinese government denies these allegations.