DIAGNOSIS The auto-rotate feature requires a specific, active data connection from the host computer's sensors, not just a video signal. It is not working because the necessary data link is missing.
FIX You must use a single high-quality USB-C to USB-C cable that supports video and data. Connect it from your computer's USB-C port (which must support video) to the monitor's primary USB-C port (usually labeled with a video icon). The computer's accelerometer will then feed rotation data to the monitor.
IF THAT DIDN'T WORK Ensure auto-rotate is enabled on your computer. On Windows, go to Settings > System > Display and ensure "Lock rotation of this display" is off. Also, the monitor's own OSD may have a rotation lock. Press the OSD button, navigate to 'System' or 'Other', and ensure 'Auto Rotation' is set to 'On'.
HEADS UP If you are using an HDMI connection with a separate USB-C cable for power, auto-rotate will not function. That connection method provides only video and power, not the necessary sensor data from the computer.