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Tesla and EV supply chains raise concerns about forced labor in China

Reporter Evan Halper spent months mapping the opaque China-based supply chains behind the production of millions of electric vehicles. With the help of researchers, he pieced together hundreds of financial disclosures, company communications, social media postings, reports from Xinjiang news outlets and contracts to reach the findings in this project. Halper covers energy for The Washington Post’s business desk.

Tesla boasts that its electric vehicles are a marvel not just of innovation but also ethics, pledging in annual reports that it will “not knowingly accept products or services from suppliers that include forced labour or human trafficking in any form.” The carmaker touts its teams of monitors that travel to mining operations around the world, and has pledged to mount a camera at an African mine to prevent the use of underage or slave labor.

But Tesla has been conspicuously silent when it comes to China, despite evidence that materials that go into its vehicles come from the Xinjiang region, where forced labor has been rampant. Firms that appear to undermine a U.S. ban on products made in Xinjiang emerge near the top of Tesla’s sprawling network of suppliers, according to a Washington Post examination of corporate records and Chinese media reports. Among them are companies that have openly complied with China’s quotas for moving minority Muslim Uyghurs out of rural villages and into factory towns through what Chinese authorities call “labor transfers” or “surplus labor employment.”

Tesla is among several EV companies that have suppliers with Xinjiang connections, records show. Ford has a deal with a battery maker that congressional investigators allege has ties to vast lithium mining and processing operations in Xinjiang, and Volkswagen operates a factory in the region with a Chinese partner.

Though not all labor in Xinjiang is forced, China’s lockdown on information flowing from the region led the U.S. government last year to bar the import of any Xinjiang-made parts and products out of a concern they could be made with coerced labor.

Clean cars, hidden toll

A series unearthing the unintended consequences of securing the metals needed to build and power electric vehicles

The companies’ kid-glove approach on China and potential violations of U.S. law come as the White House and powerful congressional committees scrutinize the EV industry, which is booming as automakers race to gain the upper hand in the transition to climate-friendly battery-powered engines. The situation in Xinjiang is a key point of tension in the strained relationship between China and the West, as the United States and allies step up enforcement of penalties on industries operating there.

EVs are widely considered vital for confronting climate change, and the companies that make them are at an inflection point. The contracts and accountability measures they lock in now could affect communities around the world for decades. Many experts warn that companies are failing to ensure that their supply chains are free of forced labor, washing their hands of responsibility for upstream suppliers they shrug off as out of their managerial reach.

“We know from every other industry there is that if we don’t fix this now, in the early days of this transition, it will be a massive mistake,” said Duncan Jepson, a lawyer and supply-chain management expert. “But the auto companies are not giving much hope they are willing to do anything to make a difference.”

Automakers say they take pains to ensure that their suppliers are not sourcing from Xinjiang. Their efforts are hampered by China’s lack of transparency and demands that companies doing business there fall in line with the country’s industrial and ethnic policies even when they conflict with Western laws. And they say the vast web of up to 13,000 companies that provide materials is difficult to vet.

Yet evidence of sourcing from Xinjiang lies not very deep in their supply chains, The Post found. Chinese supply chains that provide the industry with materials for batteries, bodies and wheels include companies that openly use Xinjiang labor, according to The Post’s examination.

The extraction and processing of materials used in EV manufacture, such as lithium, manganese and bauxite, are rapidly expanding, posing a test for company policies that tout respect for human rights and the environment. Tepid enforcement has contributed to the exploitation of workers in the cobalt mines of the Democratic Republic of Congo, the destruction of livelihoods in the villages of Guinea and the potential enrichment of the repressive Taliban regime in Afghanistan.

The shifting of Uyghurs from rural areas to factory towns has been part of a larger crackdown in Xinjiang, mounted by the Chinese government and aided by private industry. In recent years, Muslim minorities have been forced into reeducation camps where, rights investigators say, they undergo political indoctrination and military-style training.

Many of the reeducation camps have emptied since the peak of the repression in the late 2010s. But the United Nations said last year that the continued mass detentions may constitute crimes against humanity, and the United States accuses Beijing of genocide.

China’s secrecy and threats of penalties for those who cooperate with human rights inquiries make it nearly impossible to verify if workers in a factory or mine are there by choice. Against that backdrop, the United States last year implemented the Uyghur Forced Labor Prevention Act, which treats all manufacturing in Xinjiang as tainted by forced labor unless firms can prove otherwise.

Particular scrutiny is falling on Tesla because of its market dominance and conscientious image.

“Tesla is proclaiming one thing in its sustainability reports and English-language pronouncements and then doing something totally different,” said Nathan Picarsic, a co-founder of Horizon Advisory, a geopolitical risk advisory firm that worked with The Post to map EV company links to Xinjiang.

Tesla did not respond to detailed questions from The Post. At a May investor meeting, chief executive Elon Musk promised to place a webcam at a Congo cobalt mine but ignored calls from shareholder groups for the company to disclose and sever ties with firms suspected of using forced labor in Xinjiang. On its website, the company says it continues “to map our complex supply chains to understand their origins. New suppliers are required to disclose the details of their supply chains so we can verify sources and identify risks via third-party audits.”

Tesla relies on China as a supplier, but also a market for its top-selling EVs. It sells about 40 percent of its new cars in the country.

“The risk of not being able to sell in China is crippling to Tesla,” said an industry supply-chain consultant who spoke on the condition of anonymity to talk candidly. “There are just red lines Tesla cannot cross because of that. Talking about the problem of forced labor publicly is one of them. They might be working on the issue privately, but if they are, they won’t be talking about it.”

Chinese companies supply nearly 40 percent of the materials for batteries that go into Teslas worldwide, according to Nikkei Asia, a financial newspaper that scrutinized more than 13,000 companies in the Tesla supply chain.

Researchers at the Helena Kennedy Center for International Justice at Sheffield Hallam University in Britain found that a complex web of suppliers and middlemen allows Tesla and several other companies to source material from Xinjiang without buying directly from there.

“We knew that there was forced labor built into the whole program,” said Kendyl Salcito, a co-author of the center’s report. “But we didn’t know it would touch on so many commodities and parts. We hadn’t actually understood how horrific the spread of forced labor was in this sector.”

A battery supply chain

The Post examined several Chinese supply chains that provide the EV industry with lithium for batteries; aluminum for batteries, bodies and wheels; and graphene, a lightweight material used in batteries and bodies. Each chain originated with companies that openly operate in Xinjiang using local labor.

Companies mining or processing key materials in the Xinjiang Uyghur region

China is rapidly expanding conventional and EV supply chains in Xinjiang, where U.S. law presumes all products are tainted by forced labor unless firms can prove otherwise.

Sources: Murphy, L., Salcito, K, Uluyol, Y, Rabkin, M,

et al (2022). “Driving Force: Automotive Supply Chains and

Forced Labor in the Uyghur Region,” Sheffield Hallam

University’s Helena Kennedy Center for International Justice.

Companies mining or processing key materials in the Xinjiang Uyghur region

China is rapidly expanding conventional and EV supply chains in Xinjiang, where U.S. law presumes all products are tainted by forced labor unless firms can prove otherwise.

Sources: Murphy, L., Salcito, K, Uluyol, Y, Rabkin, M, et al (2022). “Driving

Force: Automotive Supply Chains and Forced Labor in the Uyghur Region,”

Sheffield Hallam University’s Helena Kennedy Center for

International Justice.

Companies mining or processing key materials

in the Xinjiang Uyghur region

China is rapidly expanding conventional and EV supply chains in Xinjiang, where U.S. law presumes all products are tainted by forced labor unless firms can prove otherwise.

Sources: Murphy, L., Salcito, K, Uluyol, Y, Rabkin, M, et al (2022). “Driving Force: Automotive Supply

Chains and Forced Labor in the Uyghur Region,” Sheffield Hallam University’s Helena Kennedy Center

for International Justice.

One of those chains involves the world’s largest EV battery maker, Contemporary Amperex Technology Co. Ltd., or CATL, based in Ningde, on China’s east coast. CATL’s products power hundreds of thousands of Teslas assembled in both China and North America. It also has contracts with at least six other major global automakers.

CATL has already attracted scrutiny from U.S. officials because of its business relationship with Xinjiang Zhicun Lithium, one of the largest lithium carbonate producers in China. CATL’s collaboration with Ford on a new battery plant in Michigan has triggered forced-labor inquiries from two influential House committees and a group of Republican senators.

While there are large lithium deposits around the world, much of the refining and processing happens in China, where three-quarters of the world’s lithium-ion batteries are made. China is expanding those sectors in Xinjiang, and Zhicun is a big part of that effort. In the past few months alone, Zhicun has poured more than $1 billion into the region, according to corporate disclosures and media reports in China.

A confidential report to investors from a Chinese research firm lays out Zhicun’s growth in Xinjiang, detailing four major acquisitions in the region’s mining belts, some of them in partnership with government authorities. The report, which was written in February, was shared with The Post by a researcher on the condition that the author’s name and firm not be disclosed, as the person could be at risk of prosecution under China’s anti-sanctions laws.

The report warns clients that if U.S. regulators become aware of the scope of Zhicun’s involvement in Xinjiang, it could trigger seizures of products.

As the world moves toward electric vehicles, we break down this industrial shift and its hidden human, geopolitical and environmental tolls.

Auto industry suppliers such as Zhicun are a linchpin of the Chinese government’s policies in Xinjiang. The information they share with Chinese news outlets and on social media platforms has included photos of ethnic-minority laborers transferred to the factory cities of Xinjiang. Recent local press coverage of Zhicun emphasizes how the company is facilitating “rural employment of surplus labor” and is helping government officials “strengthen the transfer of employment of the rural labor force.” Such phrases are not an admission that labor is forced but are seen by investigators as indicating there is a high risk. Refusing a labor transfer order can lead to internment, activists say. Officials from other companies have shared details about months-long ideological and military-style training programs their workers complete.

CATL said in a statement that it hasn’t had a relationship with Zhicun since selling its stake in the lithium company this year. It said it “opposes and prohibits any forms of forced labor in the operations of CATL and our suppliers.” The company said that it has an audit program to assess the sustainability of its suppliers and that it has joined the U.N. Global Compact, a voluntary initiative in which companies pledge to support human rights.

But days after CATL’s sale of Zhicun closed, a limited partnership run by a former senior manager at CATL “with the financial support of CATL and one of its wholly-owned subsidiaries” purchased a majority stake in Zhicun, according to House investigators. Zhicun did not respond to questions from The Post.

Ford, which has entered into a licensing agreement with CATL, said in a statement that there are no Zhicun materials in its supply chain, and that Ford will “continue to engage CATL to prevent and, if necessary, address human rights issues in their supply chain.”

An aluminum supply chain

A second supply chain examined by The Post focuses on the provision of aluminum.

One company that has emerged as a red flag for researchers is Shandong Nanshan Aluminum, based in Yantai, on China’s northeastern coast, which supplies metal for EV batteries and exteriors to Tesla and several other automakers, as well as CATL.

Shandong Nanshan appears to be buying and shipping aluminum from smelters in Xinjiang through another company and a joint venture, according to evidence uncovered by the Sheffield Hallam researchers. A separate review of Chinese public financial disclosures by Horizon suggests that Shandong Nanshan and a subsidiary have been major buyers from a Xinjiang industrial giant called Xinjiang Zhonghe Co., which is deeply involved in carrying out the Chinese government’s labor transfer programs.

Shandong Nanshan did not respond to a detailed list of questions from The Post. Xinjiang Zhonghe, which did not respond to questions either, has been open about its role in China’s ethnic policies. The company in 2019 was among those that set up “vocational” training centers. Investigators from the United Nations’ Economic and Social Council warned in March that some of Xinjiang’s vocational centers have functioned more like prisons.

A top official at Xinjiang Zhonghe in September 2021 received an award from the regional government for embracing “the [Communist] Party’s ethnic policies” and helping secure “an ideological Great Wall for safeguarding national unity and ethnic unity.”

Xinjiang Zhonghe works with the Xinjiang Production and Construction Corps, or XPCC, a paramilitary organization that carries out the Communist Party’s repression in the region. The U.S. Treasury Department imposed sanctions on the XPCC in 2020, accusing it of “implementing a comprehensive surveillance, detention, and indoctrination program targeting Uyghurs and members of other ethnic minority groups.” The Chinese government denied the allegations and retaliated with sanctions against Western officials.

Xinjiang Zhonghe also reported in financial disclosures in 2020 and 2021 that its major customers included a Chinese firm called Beijing WKW Automotive Parts. Beijing WKW, which did not respond to written questions, has a deal to supply exterior parts to a Tesla factory in Shanghai.

Beijing WKW reported in its financial disclosures in China that Xinjiang Zhonghe was a top supplier from 2014 to 2019, after which the company stopped revealing the names of its top suppliers.

Another supply chain for EV metals

A third supply chain examined by The Post centers on Xinjiang Zhongtai Group, a huge industrial player in China that supplies the EV industry with aluminum and graphene. The company openly embraced Uyghur labor transfers as recently as 2020.

As Uyghur repression was intensifying in 2017, the company reported that it had transferred “2,000 surplus workers” to its industrial parks in Urumqi and Korla from Kashgar and Hotan, both about 900 miles away. The article highlighted how workers were taught to “appreciate the kindness of the [Communist] party” and participated in military-style training. The Uyghurs, who speak their own Turkic language, were also required to learn Mandarin and adhere to the “three loves and three antis — love the Party, love the motherland, love the big family of Chinese nationals; anti-separatism, anti-violence, and anti-extremism.”

In separate photos, groups of workers from a rural village — some pinned with big red flowers, others in military fatigues — are exhorted as they board buses and trains headed for the factory to strive toward Chinese leader Xi Jinping’s expectations for social stability. Postings in 2020 showed transferred workers in face masks at a facility where they were undergoing up to six months of training in such topics as “national unity” and “ideological and moral education.”

The U.S. Department of Homeland Security in June placed the publicly traded arm of Xinjiang Zhongtai on its list of companies whose products cannot be imported under any condition, as a result of its “working with the government of Xinjiang to recruit, transport, transfer, harbor or receive forced labor or Uyghurs, Kazakhs, Kyrgyz, or members of other persecuted groups out of Xinjiang.” Robert Silvers, the department’s undersecretary for policy, put U.S. companies on notice at the time that ties to the Chinese suppliers would have consequences. “Businesses must know their supply chains,” he said. Xinjiang Zhongtai did not respond to questions from The Post.

But enforcement of such rules is inconsistent. The auto industry has been able to work around the Biden administration’s ban on investments in, and certain business partnerships with, major suppliers to the Chinese military, including China South Industries Group Corp., a firm that sells weapons and also is a large auto manufacturer.

A review of EV maker connections to the Chinese military, commissioned by The Post from the firm Strategy Risks, revealed that Ford nonetheless remains in a major joint venture with a subsidiary of China South Industries Group. The partnership, which operates under the name Changan Ford Automobile Co. Ltd., employs 13,000 people making EVs and other cars in China.

Ford said it is in compliance with the White House order, as it is not an investor in Changan or China South Industries Group. “Changan is one of China’s largest publicly traded auto companies with most of the shares held by the public,” a statement from Ford said. “When Ford entered the China market more than 20 years ago, Ford and Changan created an independent joint venture as required to manufacture and distribute Ford vehicles.”

Experts shocked

As international condemnation and investor concern mount over Uyghur-made products infiltrating global supply chains, Chinese companies have become more selective about the information they share revealing participation in the mass transfer of “surplus” Uyghur labor, according to Adrian Zenz, a scholar who has compiled some of the most vivid evidence of what the U.S. government calls genocide. Photos of indoctrination ceremonies and military-style training on social media have given way to reports of job fairs and employee success stories.

Zenz this year presented research before Congress finding that while many of the reeducation centers have closed, the repression is taking other forms — including outright imprisonment, stepped-up surveillance and restriction of movement — as “intrusive and coercive labor placement and retention mechanisms are being intensified rather than dismantled.” The U.S. Commission on International Religious Freedom, part of the federal government, found the same this year. China has meanwhile prohibited investigators from accessing the region and threatens harsh penalties for anyone who helps companies operating in China investigate their exposure to forced labor.

The extent to which Xinjiang labor has seeped into the broader EV supply chain has shocked even experts who have long studied the region. The Sheffield Hallam report detailed the links that most major auto companies now have, finding that every one of them is at high risk of making cars that use forced labor.

The report touched off a Senate Finance Committee investigation into auto companies’ ties to forced labor in Xinjiang.

“There is no excuse,” said Sen. Ron Wyden (D-Ore.), the committee’s chair. “This is a place where the Chinese government is committing genocide. … These companies are not going to be able to get on top of their forced-labor problem by papering it over with a bunch of marketing gloss.”

The targets of Wyden’s committee include Volkswagen, which is among the non-Chinese automakers most closely linked to Xinjiang. The company, which relies on sales in China for nearly half its revenue, operates a plant together with a Chinese firm in Xinjiang. Volkswagen said in a statement to The Post that it has found no evidence of forced labor in its operations there and plans an independent audit.

Wyden said the responses the committee is receiving from the carmakers reveal that EV companies do very little to apply their ethics codes to the lion’s share of businesses that make their parts. They typically vet their suppliers by asking them to fill out a questionnaire.

“These questionnaires are hilarious,” said Salcito, the co-author of the Sheffield Hallam report. “They include questions like, ‘Do you employ forced labor? Do you employ children?’ You’ll be shocked to learn the answer is always no.”

Several experts interviewed said EV companies risk a reckoning similar to that of solar panel firms, which plunged into crisis last year as U.S. agents seized more than 1,000 shipments over concerns of possible forced labor in Xinjiang and other trade violations.

Automakers are addressing the issues with varying degrees of urgency.

Researchers at Sheffield Hallam and the nonprofit Lead the Charge, which ranks EV companies for supply-chain ethics, pointed to Mercedes-Benz as an example of a company that is working hard to address human rights problems in its supply chain. The company has aggressive auditing targets, sends teams to investigate abuses reported at upstream suppliers, and gives its sustainability team considerable clout in the corporate office.

Ford argues that it does many of those same things and has one of the industry’s most comprehensive systems tracing raw materials from mines to assembly plants.

Tesla helped launch a mapping program to show customers the origins of the cobalt in one of its batteries. Volvo, which disputes findings by Sheffield Hallam that at least six of its suppliers have links to forced labor, says it is using blockchain technology and artificial intelligence to locate problems.

“Mapping our supply chain is an immense work, which is an equally important as challenging task,” said a statement from Volvo. “The supply chains are complex, global and dynamic. Hence, this is a way of working that has no end date.”

Tracking EV materials

There’s still heated debate, though, over whether the industry is up to the task of honestly confronting human and environmental exploitation in the production of EVs, considering how rampant they remain. And there is suspicion by even many inside the industry that some of the mapping and tracing initiatives automakers are unveiling are more driven by the hope of keeping regulators at bay than boosting accountability.

Such concerns have moved the European Union to mandate that by 2026 all EVs come equipped with a “battery passport” that details the origin of materials in the battery, along with its carbon footprint.

“Some in the industry are saying tracing these things through the supply chain can’t be done. [Though] it may not be easy … it is nowhere close to impossible,” said Doug Johnson-Poensgen, chief executive of Circulor, a supply-chain monitoring firm advising European regulators. “Everybody is going to have to do this.”

Johnson-Poensgen says new technologies enable auto companies and their suppliers to track materials through each step in the production process, setting off alarms if sustainably mined minerals are mixed with other minerals, for example. The tracking systems sort through reams of data to determine if there are local labor or environmental violations at facilities. Satellites can use cameras to help monitor the operations and who is coming and going from them.

Some major suppliers and automakers, though, are lobbying the E.U. to allow the industry to design and enforce battery-passport rules, rather than subjecting their reports to independent review.

Jepson, who has deep experience helping companies use technology to confront modern slavery, said the ability of shoestring-budget operations like Horizon and Sheffield Hallam to discover forced-labor connections that car companies haven’t found shows that the firms are not trying hard enough.

“You are going to tell me a tiny [nongovernmental organization] can find out what is happening with your suppliers and you can’t?” he said. “For car companies to say they don’t have the technology or manpower to figure this out is nonsense.”

About this story

Reporting by Evan Halper. Photography by James Forde, Shuran Huang, Lauren Justice, Leah Nash and Stephen Speranza.

Design by Lucy Naland. Development by Irfan Uraizee. Graphic by Júlia Ledur.

Sandhya Somashekhar was the lead editor. Editing by Haley Hamblin, Courtney Kan, Vanessa H. Larson, Olivier Laurent, Joe Moore, Martha Murdock and Alan Sipress.

Additional support from Steven Bohner, Matt Clough, David Dombrowski, Gwen Milder, Sarah Murray, Andrea Platten, Tyler Remmel, Erica Snow and Daniela Vivas Labrador.

Clean cars, hidden toll

As the global demand for electric cars begins to outpace the demand for gas-powered cars, Washington Post reporters set out to investigate the unintended consequences of a global EV boom. This series explores the impact of securing the minerals needed to build and power electric vehicles on local communities, workers and the environment.

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