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Report: Global Carmaker Supply Chains Exposed to Xinjiang Forced Labor

FILE - Ethnic Uyghurs take part in a protest against China near the Chinese Consulate in Istanbul, on Oct. 1, 2023, China's National Day.
FILE - Ethnic Uyghurs take part in a protest against China near the Chinese Consulate in Istanbul, on Oct. 1, 2023, China's National Day.

A new report finds that some global carmakers are applying weaker human rights and responsible-sourcing standards to their joint ventures in China due to pressure from the Chinese government.

The lax standards increase the risk of exposing supply chains to forced labor from China’s Xinjiang Autonomous Region, where more than 1 million Uyghurs and other ethnic minorities have been subject to mass internment and other forms of persecution.

According to the report from Human Rights Watch, titled Asleep at the Wheel, several major global carmakers, including Volkswagen, Tesla, General Motors and Toyota, have failed to minimize the risk of Uyghur forced labor being used in their aluminum supply chain, an important material for automotive parts.

"The aluminum supply chain operates with multiple layers between the car company and the aluminum producer, and these layers create an opaqueness that kind of benefits the car industry because carmakers can buy material without knowing its origin and without knowing the risks to a context like Xinjiang," Jim Wormington, a senior researcher at HRW and author of the report, told VOA by phone.

In recent years, several international investigations have found evidence of forced labor in Xinjiang. Some research warns that the supply chains of certain industries, such as the solar panel and auto industries, may be exposed to forced labor from Xinjiang.

With about 15% of the aluminum produced in China being sourced from Xinjiang, HRW found evidence through Chinese state media articles, company reports and government statements that aluminum producers in the region are participating in labor transfers.

"The link between Xinjiang, the aluminum industry, and forced labor is Chinese government-backed labor transfer programs, which coerce Uyghurs and members of other Turkic Muslim communities into jobs in Xinjiang and other regions," the report said. It added that evidence from Chinese government sources shows that aluminum smelters in Xinjiang participated in labor transfers.

Since most aluminum from Xinjiang is mixed with other metals to make aluminum alloys in other parts of China, it’s difficult to determine how much aluminum came from Xinjiang. "Aluminum ingots from Xinjiang are brought and sold by commodities traders, further obscuring the links between Xinjiang and supply chains," the report said.

FILE - An ethnic Uyghur demonstrator takes part in a protest against China near the Chinese Consulate in Istanbul, on Oct. 1, 2023, China's National Day.
FILE - An ethnic Uyghur demonstrator takes part in a protest against China near the Chinese Consulate in Istanbul, on Oct. 1, 2023, China's National Day.

At least three aluminum producers or smelters in Xinjiang, including Xinjiang East Hope Nonferrous Metals, Tianshan Aluminum and Xinfa Group Xinjiang, have been identified as either receiving labor transfers targeting Uyghurs and other ethnic minorities or are being closely linked to Xinjiang Production Construction Corps, which plays a key role in the repression of Uyghurs in Xinjiang, according to previous research and investigations.

In response to criticism of facilitating forced labor in Xinjiang, the Chinese Embassy in Washington said the accusation is "a lie of the century fabricated to smear China."

"The people in Xinjiang have their workers’ rights concretely guaranteed," a spokesperson from the embassy told VOA in a written response. "This falsehood only proves that some in the United States are using human rights to disadvantage China, disrupt international trade rules and undercut the stability of international industrial and supply chains."

Despite Beijing’s efforts to push back against accusations related to forced labor in Xinjiang, Human Rights Watch said global carmakers have a responsibility to identify, prevent, and mitigate the presence of forced labor in their supply chains under regulations mandated by the United Nations.

Some carmakers, including Volkswagen and Tesla, told HRW they have limited capacity to address their Chinese joint ventures’ supply chain links to Xinjiang.

Volkswagen, which holds 50% of the equity of its joint venture in China with Chinese automaker SAIC, claimed they are "not legally responsible" for human rights impacts in its joint venture’s supply chain because Germany’s supply chain law "only covers subsidiaries in which companies have decisive influence."

When asked about the potential links between their Chinese joint venture and an aluminum producer in Xinjiang, Volkswagen admitted they have "no transparency about the supplier relationships" of their Chinese joint ventures.

Despite the difficulty of conducting audits in China and fear of retaliation from the Chinese authorities, Wormington from HRW said there are ways for carmakers to demand more information from Chinese suppliers about the supply chain.

"[While] some carmakers really fear retaliation, since Chinese carmakers want access to global markets, global carmakers can ask their suppliers to get more information on their supply chain," he told VOA. "There are things that carmakers can do, but in the context where they can’t ask suppliers about human rights issues, that becomes extremely difficult."

Some foreign jurisdictions, including the United States and European Union, have enacted or are planning to pass laws that require businesses to disclose their supply chains and identify potential links to human rights abuses. Some governments have also imposed import restrictions to prevent products connected to forced labor from entering their countries.

Despite efforts by governments to prevent supply chains from being exposed to elements of forced labor from Xinjiang, some analysts think businesses need to clearly express their concerns to Beijing.

"In an ideal world, businesses would make clear at the highest level to the Chinese government that this is going to be a problem unless businesses can have their staff conduct due diligence freely to ensure there isn’t forced labor in their supply chains," said William Nee, research and advocacy coordinator at Chinese Human Rights Defenders, a U.S.-based activist network, in a telephone interview.

Yalkun Uluyol, a researcher at Sheffield Hallam University, said companies "must stop directly or indirectly sourcing anything made in the Uyghur region, in part or whole, to ensure their products are free of Uyghur forced labor."

The companies should make public commitments to such a policy, he added in a written response to VOA.