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US: Volkswagen cars stuck in ports over banned part — report

February 15, 2024

Thousands of vehicles shipped by Volkswagen — including Porches and Bentleys — have been held up at US ports over a Chinese-made component, according to the Financial Times.

Volkswagen logo
Volkswagen said it was working to rectify a delay in delivering certain Volkswagen Group vehicles from ports to dealers due to a customs issueImage: Hendrik Schmidt/dpa-Zentralbild/dpa/picture alliance

German carmaker Volkswagen (VW) on Wednesday said there had been a hold-up in the delivery of certain models to the US market over issues related to a car part — which according to a Financial Times (FT) report — may have violated US anti-forced labor laws.

"We are working to rectify a delay in delivering certain Volkswagen Group vehicles from US ports to dealers due to a customs issue," Volkswagen said in a statement to DW.

Report points to Chinese-made component

The FT reported that thousands of Porsche, Bentley and Audi vehicles had been impounded at US ports after a supplier to parent company Volkswagen discovered a Chinese-made subcomponent inside the vehicles that was in breach of labor laws.

The publication cited two people with knowledge of the matter.

The FT reported that the electronic component came from "western China," but said the sources had emphasized that Volkswagen was unaware of the origin of the specific part which is said "was sourced by an indirect supplier further down its supply chain, until the supplier alerted it to the issue."

The Germany-based carmaker was understood to have alerted US authorities immediately after this information became known.

What did Volkswagen say?

In a statement, Volkswagen said the issue was linked to a "small electronic component," which was "in the process of being replaced."

The company said they were taking "allegations of infringements of human rights very seriously, both within the company and in the supply chain."

China peddles alternative reality in Xinjiang

"As soon as we received information of allegations regarding one of our sub-suppliers, we have been investigating the matter," the group said.

Volkswagen vowed to clarify the facts and then take appropriate steps. "These may also include the termination of a supplier relationship if our investigations confirm serious violations," the statement said.

US sanctions products from Xinjiang

The exact origins of the component were not clear. However, on Wednesday the company said it was considering the future of its activities in China's western Xinjiang province, after the German Handelsblatt daily publication reported that forced labor may have been used to build a test track in Turpan.

The company said it had seen no evidence of human rights violations relating to the project but that it would investigate any new information that came to light.

The US has had a ban in place on the imports from  Xinjiang since December 2021.  Dozens of countries have condemned China for "crimes against humanity" over the treatment of Xinjiang's Uyghur community. In 2022, the UN found there had been serious human rights violations committed by China, including forced labor.

US officials will only allow goods from the province if importers can provide proof that production did not involve forced labor.

Several major corporations have ended their operations in Xinjiang due to claims that China is committing "genocide" against the Muslim Uyghur minority, but Volkswagen has opted to stay.

kb/dj (AFP, Reuters)