Chinese electric vehicle giant BYD faces serious allegations of labor violations and irregular work visas in Brazil, sparking a government investigation and halting construction of its new factory.
At a Glance
- BYD brought hundreds of Chinese workers to Brazil on irregular visas for factory construction
- 163 workers found in “slavery-like” conditions at BYD’s Bahia factory site
- Brazil suspends temporary work visa issuance for BYD amid human trafficking accusations
- BYD denies wrongdoing, severs ties with contractor Jinjiang
- Chinese government urges companies to comply with local laws in international operations
Labor Violations Uncovered at BYD Factory Site
Brazilian authorities have launched an investigation into Chinese electric vehicle manufacturer BYD for alleged labor violations and the use of irregular work visas at its Camacari factory construction site. The probe revealed that approximately 163 workers were subjected to conditions described as “slavery-like” by Brazilian labor inspectors.
The workers, brought from China to Brazil, reportedly faced degrading living conditions and unfair compensation. According to the Brazilian Public Prosecutor’s Office, the situation was dire enough to be classified as a violation of human dignity. The discovery has led to the halting of construction at the site and a ban on issuing new work visas to BYD.
Government Response and Visa Suspension
In response to the allegations, the Brazilian government has taken swift action. The Ministry of Foreign Affairs announced the suspension of temporary work visa issuance for BYD, citing concerns over potential human trafficking. This move could significantly impact BYD’s operations in Brazil, where the company has invested $620 million in the Bahia factory project.
“Brazil has stopped issuing temporary work visas for BYD,” the Ministry of Foreign Affairs stated in the wake of accusations that some workers at a site owned by the Chinese electric vehicle producer had been victims of human trafficking.
The severity of the situation is further underscored by the possibility of revoking residence permits for the Chinese workers if irregularities are confirmed.
BYD’s Response and Contractor Dispute
BYD has vehemently denied the accusations, suggesting that they are part of a smear campaign against the company. In an attempt to address the situation, BYD has severed ties with its contractor, Jinjiang Construction Brazil, which it said was directly responsible for the workers’ conditions. Jinjiang, for its part, also denies any wrongdoing.
The Chinese EV manufacturer has committed to adhering to local labor laws for the remaining workers in Brazil and has reportedly relocated affected workers to hotels while reviewing the conditions of subcontracted employees. However, these actions have not halted the ongoing investigation or alleviated concerns about the company’s labor practices.
Implications for BYD’s Global Expansion
This scandal comes at a crucial time for BYD, which recently surpassed Tesla as the world’s leading EV manufacturer. The Camacari plant was set to be BYD’s first electric vehicle factory outside of Asia, with plans to produce 150,000 vehicles annually by 2025. The project represented a significant step in BYD’s global expansion strategy and was seen as a testament to China’s growing influence in Brazil’s automotive sector.
