German automakers BMW and Volkswagen have both been accused by a congressional investigation of utilizing components tied to forced labor in China.
The automaker giants reportedly used parts manufactured by JWD, a company that was added to the Uyghur Forced Labor Prevention Act Entity List (UFLPA) in December 2023 for its connection to slave labor of the Uyghur minority by the Chinese Communist Party, according to the investigation conducted by the Senate Finance Committee. In 2016, BMW admitted “profound regret” for using slave labor under the Nazi regime during World War II, and Volkswagen set up a fund in 1998 to compensate workers who were forced to work for the company during the war. (RELATED: Major Auto Union Handed Huge Defeat By Alabama Workers)
Jaguar Land Rover was also listed as obtaining parts from JWD, according to the report. BMW, Volkswagen and Jaguar all claim that they were unaware that JWD was in their supply chain until after it had been designated on the entity list.
“Automakers are sticking their heads in the sand and then swearing they can’t find any forced labor in their supply chains,” Oregon Democratic Sen. Ron Wyden, chair of the Senate Finance Committee, said in a press release. “Somehow, the Finance Committee’s oversight staff uncovered what multi-billion-dollar companies apparently could not: that BMW imported cars, Jaguar Land Rover imported parts, and VW AG manufactured cars that all included components made by a supplier banned for using Uyghur forced labor. Automakers’ self-policing is clearly not doing the job. I’m calling on Customs and Border Protection to take a number of specific steps to supercharge enforcement and crack down on companies that fuel the shameful use of forced labor in China.”
BMW continued to use parts from the supplier after they were informed in writing by a direct supplier in January 2024, according to the report. When asked whether they had ever received parts from JWD directly or indirectly in April, BMW said that the company was not on their supplier list.
Around 8,000 Mini Cooper BMW cars containing parts from JWD had been shipped to the U.S. since the ban was put in place, according to the report. The company reportedly continued importing vehicles with the parts until at least April, despite being notified by the committee.
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Volkswagen voluntarily disclosed in February that vehicles that it had produced to sell in the U.S. contained components manufactured by JWD, according to the report. The company then arranged to replace the components upon their arrival at U.S. ports before they were sold.
“The Tier Three subcomponent referenced in the Senate Finance Committee report was used in a prior generation of technology and is not in current JLR vehicles for sale,” Jaguar Land Rover told the Daily Caller News Foundation. “Once our compliance team were informed that a Tier Three subcomponent manufacturer was on the UFLPA Entity List, JLR immediately stopped all shipments of the two affected aftermarket service parts and all existing inventory containing the affected subcomponent globally were quarantined for destruction.”
China has detained more than 1 million Uyghurs in the Xinjiang region and has subjected them to various human rights abuses like forced labor, internment and “reeducation,” according to the State Department. U.S. lawmakers have passed restrictions under the UFLPA that bar goods made in whole or in part in Xinxiang from being imported into the country.
The companies noted in the investigation that it is difficult to audit suppliers in China because government restrictions can give companies time in advance to hide connections to forced labor, according to the report.
In addition to manufacturing car parts, the Xinjiang region also produced around 31% of the world’s cotton between 2020 and 2021, posing a particular difficulty in monitoring supply chains in the textile industry. In May, the Biden administration announced 26 additional Chinese textile companies that were to be added to the entity list.
BMW and Volkswagen did not immediately respond to a request to comment from the DCNF.
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