Brazilian authorities have halted construction of a factory for Chinese electric car giant BYD, saying workers are living in conditions akin to “slavery.”
More than 160 workers were rescued in the northeastern Brazilian state of Bahia, according to Bloomberg News. Statement from the Public Prosecution for Labor (MPT).
They were allegedly placed in a “humiliating” environment and had their passports and salaries held by a construction company.
BYD said in a statement that it had severed ties with the company in question and remained committed to “full compliance with Brazilian legislation.”
The plant was scheduled to become operational by March 2025, and was to be BYD's first electric vehicle plant outside Asia.
The workers, hired by Jinjiang Construction Brazil, lived in four facilities in the city of Camasari.
In one of these facilities, workers were forced to sleep on beds without mattresses, according to prosecutors.
Each bathroom was also shared between 31 workers, forcing them to wake up very early to be ready for work.
“The conditions in the housing stock revealed an alarming picture of instability and deterioration,” MPT said.
“Slavery-like conditions,” as defined by Brazilian law, include debt bondage and work that violates human dignity.
The situation also constituted “forced labour”, as many workers had their wages withheld and faced huge costs for terminating their contracts, MPT added.
BYD said the affected workers were transferred to hotels.
It added that it had conducted a “detailed review” of the working and living conditions of subcontracted employees, and had asked the construction company “on several occasions” to make improvements.
BYD, which stands for Build Your Dreams, is one of the largest electric vehicle manufacturers in the world.
It has sold more electric cars than Elon Musk's Tesla In the last three months of 2023, the two competed for first place in this sector.
The company is also expanding its foothold in Brazil, which is its largest overseas market by a significant margin.
It first opened a factory in São Paulo in 2015, producing electric bus bodies.
Last year, it announced that it would invest 3 billion reais ($484.2 million) in Brazil to build a factory to manufacture electric cars.
Electric vehicle sales in China have been boosted by government subsidies. Which encourages consumers to replace their gasoline-powered cars with electric or hybrid vehicles.
But there is a growing backlash abroad against what some see as the Chinese government's unfair support of domestic automakers.
Major markets such as the United States and the European Union have imposed tariffs on electric vehicles coming from China, with more tariffs expected during the next administration of US President-elect Donald Trump.
