An apology from VW would be a big surprise – Economics

On Tuesday, there will be a hearing before the labor court in the Brazilian capital of Brasilia, which will no doubt be closely watched also in Wolfsburg. The VW Group must be responsible for working with the Brazilian military dictatorship in the 1970s and 1980s. It is one of the particularly dark chapters in Germany’s post-war economic history. The accusation of “slave labor” hangs in the air. In Brasilia, the main question will be how much responsibility a global corporation has for what happened on its premises at different times and under different political conditions. But it’s also a very simple question: can it be so hard to just say “perdão” loud and clear, sorry?

From today’s perspective, it is difficult to understand what prompted Volkswagen to establish a cattle farm in Brazil in 1973 and enter the global meat business. The car manufacturer cleared tens of thousands of hectares of forest in the Amazon basin and transported hundreds of workers to largely undeveloped land. As far as we know, VW speculated on a combination of fiscal and political gains in the Brazilian government’s announcement of the “conquest of the Amazon”. In any case, one thing is certain that did not stop Volkswagen from making this investment: Brazil was then under a brutal military regime that was oppressive, imprisoned and tortured. VW has become an accomplice of this dictatorship.

Looking back, “Fazenda Volkswagen” was a double failure for the company. It turned out to be a gigantic loss-making business and was re-sold after less than a decade and a half. However, there remains the moral declaration of bankruptcy, including a preliminary investigation. According to the findings of the Brazilian prosecutor’s office, systematic violations of human rights occurred on the VW farm in 1974-1986. It is about debt bondage, human trafficking and “slave labor exploitation.” The crimes are said to have been committed on the farm on temporary workers who were used for cleaning work – possibly with the knowledge of the Wolfsburg group management. VW faces these allegations in court for the first time on Tuesday. It would be an occasion for a big admission of guilt. But the signals point in the other direction: Perdão will not be given.

VW had previously donated money to charity, but saw it as a donation rather than an apology

This is not the first time that VW’s unconditional loyalty to Brazilian military dictators has caught up with them. 2017 documented research by NDR, SWR and SZthat during the dictatorship, Volkswagen was apparently actively involved in the political persecution of opponents of the regime at its Beetle manufacturing facility near São Paulo. In 2020, VW do Brasil pledged to pay the equivalent of EUR 5.5 million to the victims’ association. But first, the main reason was already dead by then. Second, VW emphasized the “donation nature” of the money at the time and stubbornly avoided terms such as “compensation” or “sorry.”

Today, the VW Group points out that it presents its history most clearly among the German companies that paid particular attention to the figures during the dictatorship in Brazil. But the fact that others might be doing it worse doesn’t make VW’s situation any better.

It cannot be ruled out that the alleged human rights violations on the VW farm are time-barred from the point of view of the Brazilian judiciary. But the VW Group should not retreat to a purely legal position. Here he has a moral obligation to finally actively come to terms with his past. VW must publicly apologize to the victims and compensate them accordingly. Time is pressing because many of these victims are very old. If something doesn’t happen soon, suspicion that VW wants to delay the work until no one can complain anymore.

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