By Sam Boughedda
Automakers, including Tesla (NASDAQ:TSLA) and General Motors (NYSE:GM), are part of an inquiry by the Senate Finance Committee looking into whether vehicle manufacturers are using parts and materials made with forced labor in China's Xinjiang region, The Wall Street Journal reported Thursday.
A letter sent by the committee on Thursday asked the chief executives of eight car manufacturers to provide information on their supply chains. They are looking to use the information to assist in determining links to Xinjiang. China has been accused of using forced labor involving the Uyghur ethnic minority and others in the region.
As a result, the US has banned the majority of imports from the region under the Uyghur Forced Labor Prevention Act.
However, the WSJ said a recent report from Sheffield Hallam University in the UK said it found evidence that global automakers have been using materials and parts made in Xinjiang or they are sourcing from companies that used Uyghur workers elsewhere in China.
The report is said to state that some car manufacturers "are unwittingly sourcing metals from the Uyghur region," with the greatest exposure coming from steel and aluminum parts, with producers moving work to the region to benefit from Chinese government subsidies and other incentives.
The letter, signed by Finance Committee Chairman Ron Wyden, was said to have been sent to Ford Motor (NYSE:F), Mercedes Benz Group (ETR:MBGn), Honda Motor (NYSE:HMC), Toyota Motor (NYSE:TM), Volkswagen (ETR:VOWG) and Stellantis NV (NYSE:STLA), whose brands include Chrysler and Jeep, as well as Tesla and GM.
Tesla shares have declined a further 6% Thursday, while GM is down over 5%.