Latin analysis: Volkswagen Faces Brazil's Authoritarian Legacy

Henry Milleo/picture alliance

The 1964-1985 military dictatorship is often remembered as one of Brazil’s darkest events of recent history. During that time, not only were Brazilians not allowed to choose their heads of state or exercise democracy in any way, but the government’s respect for human rights was also non-existent. It has been 30 years since former president José Sarney put an end to the military authoritarianism in 1985, when he created a new constitution and allowing citizens of the Portuguese-speaking nation to elect their leaders once again. Yet, that event is still popularly researched by academics and is still very much remembered by Brazilians, such there is a constant unveiling of new information regarding that period and the different forms of cruelty exercised to citizens and politicians who supported the opposition.

Even when the dictatorship is still often discussed, it became a heated topic again in 2015, when several former Volkswagen Brazil employees sued the German company for having collaborated with the military administration through spying its employees and identifying “enemies of the state,” as well as threatening, torturing, and murdering them inside the company’s premises.

The Alliance With the Dictatorship

Volkswagen was built to serve German political and economic goals, as it was Adolf Hitler who supported its creation so that affordable cars for workers could be produced. As it was under Nazi leadership, the automotive firm labor workforce consisted mostly (around 80%) of slave laborers. Nevertheless, it has only been during recent times that the company has also been linked to other dictatorial political movements in regions other than the European continent.

In fact, it was a group of German news organizations that openly declared that the company, for more than two decades, had been an active supporter of the Brazilian military dictatorship. As such, it was established that it had active participation in the localization and persecution of Brazilians who supported opposing parties. Parallelly, it was controversially declared by experts that the Chief Executive Director of the firm at the time, Tony Schmücker, was well aware of the situation, as also was the German government.

At first, Volkswagen seemed reluctant to make further comments. Nevertheless, the already controversial scandal became much more polemic when 12 of the company’s former employees sued the company. They claimed to have been injured mentally and physically within the company property, as well as they declared that their names were added to black lists after they were fired, such that other companies refused to hire them. Indeed, this caused grave financial and social consequences for the former workers and their families.

Due to these events, Volkswagen, in order to avoid collateral and irreversible loss of the international brand-reputation and investor trust, was forced to acknowledge its participation in the Brazilian military past. Executives as Hiltrud Werner, declared to be profoundly sorry that such events had occurred, as well as it was reaffirmed that the organization would responsibly deal with this situation, promote transparency, and hold its accountability for what had been done in the past. This alone, represents a historical occurrence, as it is the first time that a German company takes responsibility for the violation of human rights of its own employees outside of Germany and after the end of the Nazi dictatorship.

Volkswagen’s Price to Pay

After years of legal disputes, it was resolved in September that the company was to pay 36 million reals (around 6 million USD) in compensation to its former workers and their relatives. Additionally, it promised to give 4.5 million reals to fund a university project, which will be in charge of identifying the bones of clandestine cemeteries in which Brazilian militaries who served the dictatorship used to hide the bodies of their victims.

Nevertheless, even when, in principle, it might appear as a large sum of money, former Volkswagen employees have declared that it is not enough to compensate the people whose human rights were bused by the firm. It was established the proposed deal whitewashed the extent of the company’s cooperation and loyalty to the Brazilian dictatorship. Brazilians also remarked that they had been expecting the organization to create a memorial for the deceased and harassed workers, but that in the end, Volkswagen did not agree to this.

Experts have established that this outcome was already expected given that the allegations were carried under the current Brazilian far-right populist president – Jair Bolsonaro. This is the case as the head of state is an open supporter of the military regime, as he is a former army captain himself, as well as he has previously praised the former totalitarian government and has proposed some of its methods to be re-introduced in Brazilian’s politics. 

Without a doubt, this event has been a source of concern to the Brazilian public and has caught much attention of Latin American politicians. It is, however, the German government the one who has been particularly quiet about this situation, as no further comment from the German authorities about the matter has been made. 

As of today, it is unclear if the millions Volkswagen will be paying to its former workers will be enough to regain the trust of the Brazilian (and international) public and compensate its past violent doings. It is also possible that soon, as new information is continuously published by experts over the years, the firm might be forced to take further action to finally accomplish to disengage from its dark past of collaborating with governments that cruelly abuse the people’s human rights.