Reuters.- Electric vehicle maker BYD brought hundreds of Chinese workers with irregular visas to Brazil to build a factory, it told Reuters on Tuesday. Reuters a labor inspector, adding that the company promised to comply with local labor laws for workers who remain in the country.
Last month, a total of 163 of those workers, hired by BYD contractor Jinjiang, were found to be working in “slavery-like conditions.”
The 163 workers who were rescued by labor authorities in December are leaving or have already left Brazil, said Liane Durão, who led the investigation announced at the end of December.
“All of this was irregular,” Durão said, adding that BYD would be fined for each worker found in this situation, without detailing the total amount to be paid.
He added that the company agreed to adjust the conditions of the hundreds of workers who will remain in the country, to comply with local labor laws. About 500 Chinese workers were brought to work at the Brazilian factory, he said.
BYD and Jinjiang did not immediately respond to a request for comment. BYD has previously said it cut ties with Jinjiang, which disputes accusations by Brazilian authorities.
A person close to BYD told Reuters that the Chinese company believes that the visas were issued correctly and that all employees came voluntarily to work in Brazil.
The factory has become a symbol of China’s growing influence in Brazil and an example of a closer relationship between the two countries.
Labor authorities and representatives of BYD and its contractors working in Bahia met on Tuesday to negotiate how to protect the rights of all workers employed at the factory.
KEY TO BYD’S GLOBAL EXPANSION
BYD has been building the factory to assemble 150,000 cars initially as part of its plans to start production in Brazil, its biggest market outside China, early this year. It is unclear whether construction will be delayed by the investigation into working conditions at the factory.
BYD has invested 620 million dollars in the Bahia manufacturing complex alone. About one in five car sales BYD made outside China in the first 11 months of 2024 were in Brazil.
In December, the labor prosecutor’s office described the workers, hired by the Chinese construction company Jinjiang Group, as victims of human trafficking. The company had withheld the passports of 107 of the workers, according to investigators.
Slavery investigations can have serious consequences for business owners in Brazil, such as restricting their access to bank loans.
Since the workers were found to be in slavery-like conditions, the Brazilian government has suspended granting temporary visas to BYD.
Reports of irregularities in Bahia could be a major point of friction in bilateral relations.
Brazil has been seeking more Chinese investments for some time. But Beijing’s model of bringing Chinese workers to the countries where it invests poses a challenge to local job creation, a priority for President Luiz Inácio Lula da Silva.
The investigation has also brought unwanted attention to BYD, which is seeking to expand globally and consolidate its dominance in China, the world’s largest auto market, where it accounts for more than a third of the electric and plug-in hybrid vehicle market.
Labor inspectors will continue to monitor BYD sites, Durão said, to ensure that workers still employed at the factory are not subjected to abusive working conditions.
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