Volkswagen Group faces mounting pressure to address allegations of human rights violations in the Chinese province of Xinjiang, where the German automaker operates a car factory.
While there is no evidence that anyone has been mistreated at the VW plant, the company should carefully examine the accusations, said supervisory board members Joerg Hofmann, a labor leader, and Stephan Weil, who represents VW’s key shareholder Lower Saxony.
“We have to concretely weigh the facts and on this basis answer the question if a termination of the activity there would be the right thing,” Hofmann told the Braunschweiger Zeitung in an interview, citing potential damage to VW’s reputation.
VW has fielded uncomfortable questions about its suppliers and operations in Xinjiang, where human rights groups and a panel of United Nations experts have raised concerns about coercive labor practices.
China has repeatedly rejected criticisms of the work programs, calling allegations of forced labor lies and defending its policies as an effort to reduce poverty and unemployment.
VW Group CEO Herbert Diess has defended the company’s presence in the region, telling U.S. TV news program 60 Minutes in April he’s “absolutely sure” there is no forced labor at VW’s plant, and that locals “are much better off” if the company stays put.
China is Volkswagen’s biggest market, accounting for roughly 40 percent of sales.