BYD faces fallout over “slavery-like” labor claims in Brazil

A contractor for the Chinese EV carmaker, BYD, is disputing claims by Brazilian authorities that it subjected workers to deplorable conditions, with a rep for BYD jumping into the fray.

The details: Authorities in Brazil claim they found 163 Chinese nationals working in “slavery-like” conditions and human-trafficking for Jinjiang Group, a company involved in the construction of a new BYD-owned factory in the country’s Bahia state.

• Jinjiang denies the claims, saying that the report of their employees being “enslaved” was inconsistent with the facts and a matter of misunderstanding stemming from translation issues. 

• On Jinjiang’s official Weibo account (a Chinese social media platform), the company posted, “Being unjustly labeled as 'enslaved' has made our employees feel that their dignity has been insulted and their human rights violated, seriously hurting the dignity of the Chinese people… 

• The statement continues, “We have signed a joint letter to express our true feelings," – and was reposted on the personal Weibo account of Li Yunfei, general manager of branding and public relations at BYD.  

BYD said that it was cutting ties with Jinjiang Group when the claims of slavery-like conditions were first lodged against the company by authorities in Brazil, which is the EV company’s largest overseas market. 

Between the lines: The BYD factory under construction in Brazil is one of several plants being planned by the electric vehicle giant as it moves aggressively to expand its footprint globally.     

• In July, BYD announced plans to build a $1 billion plant in Turkey that will be capable of building 150,000 electric and hybrid vehicles annually.  

• The factory in Brazil is reportedly expected to produce 150,000 electric and hybrid vehicles as well. 

• BYD has even said it remains committed to building its first plant in Mexico – despite reports that it would abandon the plans if Donald Trump was reelected due to concerns that the President-elect has said he will impose stiff tariffs on Chinese imports. 

Bottom line: Given the aggressiveness of BYD’s global expansion efforts, the EV giant is likely moving swiftly (behind-the-scenes) to fully address the claims of deplorable working conditions at the factory site in Brazil with authorities. The idea of even being remotely tied to “slavery-like” conditions could be hugely detrimental to BYD’s expansion plans and its brand overall.

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