Volkswagen drew criticism from campaigners and a big investor on Tuesday after the head of its Chinese business said he saw no sign of forced labour during a visit to the car maker’s Xinjiang plant.
The works council, which is represented on Volkswagen’s supervisory board, in a statement following Ralf Brandstaetter’s comments said the company must make clear the plant’s value for the business and take a stance on human rights violations in China.
Activists, an international group of lawmakers and the head of sustainability and corporate governance at top-20 Volkswagen investor Deka Investment said verifying labour standards in the region was impossible.
“However much Mr Brandstaetter makes an effort, Volkswagen cannot be certain. That leads not only to reputational risk, but also legal issues, for example with supply chain laws,” Deka’s Ingo Speich said.
Volkswagen relies on profits from China to fund electric vehicle research and development in Germany and is fighting domestic competitors to keep market share in the country.
Brandstaetter said in January it was important to act from a “position of strength” within China and stay strong in the market while also ramping up sales elsewhere.
On Feb. 16-17, he toured the German group’s jointly-owned facility with China’s SAIC in Xinjiang, along with Volkswagen’s compliance and external relations chiefs in China.
Rights groups have documented human rights abuses in Xinjiang, including mass forced labour in detention camps that the U.N. said could constitute crimes against humanity. China has denied any abuses in Xinjiang.
Volkswagen says it has never found evidence of forced labour among its Xinjiang work force and its presence is positive for locals. It denied reports it had kept the plant open because Beijing had imposed a condition it had to keep producing across China.
“I can talk to people and draw my conclusions. I can try and verify the facts [from joint venture partner SAIC], and that’s what I did. I didn’t find any contradictions,” Brandstaetter said, adding it was his first visit but not his last.
Brandstaetter said he spoke at length to seven workers individually – including Han Chinese, Uyghurs and Kazakhs – some through a Volkswagen translator and some in English, and held shorter discussions with other workers on his tour, which he said occurred without government supervision.
But Luke de Pulford of the Inter-Parliamentary Alliance on China, a group of legislators from thirty democratic countries including Britain, Germany, and