Brazil sues EV giant BYD over ‘slavery’ conditions at plant

SAO PAULO — Brazilian labour prosecutors are suing Chinese electric vehicle (EV) maker BYD (Build Your Dreams) Company and two contractors over allegations of slave labour and human trafficking at the construction site of a manufacturing plant.

The lawsuit describes "degrading" conditions at facilities in Bahia maintained by BYD, China JinJiang Construction Brazil and Tonghe Equipamentos Inteligentes do Brasil Co — currently named Tecmonta Equipamentos Inteligentes Brasil Co. It also alleges irregularities with the visas used to bring the workers into Brazil and the confiscation of their passports.

Prosecutors said that in December, 220 Chinese workers were found in a situation “analogous to slavery” and described them as victims of international human trafficking. They have filed the lawsuit that seeks more than 257 million reais (US$46 million) in damages after the companies refused to sign a conduct adjustment agreement, they said.

BYD’s Brazilian unit said in a statement that it "reaffirms its non-negotiable commitment to human and labour rights, basing its activities on respect for Brazilian legislation and international labour protection standards." The company has been collaborating with the labour prosecutor's office and will provide further comment on the lawsuit, it said.

The EV plant in Brazil is BYD’s first outside of Asia and marked an important step in its push into overseas markets. The country is strategically important for China’s carmakers amid the political and economic rapprochement between Presidents Xi Jinping and Luiz Inácio Lula da Silva as regions like the United States and Europe impose heavy barriers on Chinese-made vehicles.

But complaints about conditions began emerging soon after work began in March 2024, with labour union Sindticcc noting safety issues including the site’s precarious cafeteria structure during a visit in April last year. The union said it had warned the construction companies about compliance as early as February last year.

In November, Brazil’s Agencia Publica, an independent news website, published photos, videos and audio showing mistreatment of staff and apparent non-compliance with international labour and safety conventions. The union, in another statement at the beginning of December, reported accidents involving two workers, one of whom had a finger amputated.

In late December, a task force from the labour prosecutor’s office rescued 163 workers and closed off lodgings and parts of the site until the situation could be fully regularised.

The same month, BYD said it had severed ties with Jinjiang Construction Brazil. Despite the controversy, the carmaker said in January that it was still committed to starting production by the end of 2025. The plant is set to have an initial capacity of 150,000 cars per year, which will be doubled to 300,000 units over the following two years.

As well as the 257 million reais in collective moral damages, prosecutors are requesting that BYD and the two contractors pay individual damages equivalent to 21 times’ each worker’s contractual salary. They are also seeking the payment of the contracted wage for each day a worker was subjected to the poor conditions, plus payment of severance that is due.

The lawsuit also seeks to have the companies comply with Brazilian labour protection standards and not subject workers to human trafficking and slave labour, according to the prosecutor’s statement.