Carmaker’s China chief toured the facility this month
Firm has fielded questions over suppliers, operations in China
By Stefan Nicola
February 28, 2023
A Volkswagen production facility in Urumqi, Xinjiang, China.
Source: Visual China Group/Getty Images
Volkswagen AG reaffirmed its commitment to an automotive plant in Xinjiang after a visit by its China chief, despite persistent concerns of human rights abuses in the country’s far western region.
The German carmaker said it has no indication that workers are mistreated at the facility in the city of Urumqi, which is operated by a subsidiary of its joint venture with state-backed SAIC Motor Corp.
“The JV plant looks like all other JV plants in China,” Ralf Brandstätter, VW’s China chief since last year, told reporters after touring the facility this month, the first such visit by a top company executive. “Our partner has great interest in and is committed to ensuring a positive atmosphere and proper working conditions.”
VW has fielded uncomfortable questions about its presence in Xinjiang due to allegations by the US and others that China has pushed ethnic minorities including Muslim Uyghurs into jobs programs as part of sweeping effort to force them to assimilate into the Han-dominated society. Last year, the United Nation’s top human rights official found that China had committed “serious human rights abuses” in Xinjiang while the world body’s slavery expert determined that the forced-labor claims in the region were “reasonable.”
China has repeatedly rejected criticism of the work programs, calling allegations of forced labor lies and defending its policies as an effort to reduce poverty and unemployment. China and the European Union have sanctioned each other’s officials over the claims, prompting Brussels to suspend approval of a landmark investment pact.
VW is under pressure to defend its position in China, its biggest market, against home-grown manufacturers offering models geared to local tastes. Sales in China have slid from a peak of 4.2 million cars in 2018 to 3.18 million vehicles last year. The likes of BYD Co. and Li Auto Inc. are catching up fast, and they’re all-in on electric vehicles.
While the Urumqi plant has been in the spotlight, it doesn’t manufacture any cars. Its roughly 240 workers — 17% of whom are Uyghurs — make final quality checks of already assembled vehicles that are then sent on to dealerships in the region.
The facility, which at its peak employed 670 workers, doesn’t get any external parts and there are no plans to resume automaking there. The plant had produced the New Santana model until 2019. VW is bound by contract to the site and has no intention to break that obligation, said Thomas Steg, the carmaker’s chief lobbyist.
Plant management is committed to making minority workers feel welcome, Brandstätter said, citing signs in several languages, a cafeteria that serves halal food, and two extra cultural holidays for Uyghur workers.
The executive said he spoke at length to seven workers individually and no government representative was present during his 1.5-day tour of the site.
“Our partner SAIC is aware of the critical reports on Xinjiang,” said Brandstätter. “We agree with them that basic values and law must be respected and protected in joint ventures.”