Brazil has added BYD to a government registry of employers found to have subjected workers to conditions analogous to slavery, following the 2024 scandal at the Chinese automaker’s factory construction site.
The list — published by Brazil’s Labor Ministry (MPT) — stems from a December 2024 raid in which inspectors rescued 163 Chinese workers hired by contractor Jinjiang Group to build BYD‘s plant in Camaçari, Bahia.
The Chinese workers were said to have been victims of human trafficking and abusive contracts.
Inclusion on the registry carries reputational risk for BYD in its largest market outside China and bars the company from obtaining certain types of loans from Brazilian banks.
It does not affect operations at the Camaçari plant, which the workers had been hired to build and which has produced more than 25,000 vehicles since its inauguration last October.
Labor Conditions
The initial investigation by the Brazilian Labor Prosecutor’s Office, opened in late 2024, accused subcontractors of imposing 12-hour shifts seven days a week.
The report also cited allegations of physical abuse by supervisors, insufficient access to safe drinking water, inadequate protective gear, and substandard living conditions.
According to the MPT lawsuit filed in May 2025, workers had 70% of their wages withheld and had to pay a security deposit they would forfeit if they ended the contract early.
In that case, they were also required to repay the company for the cost of their trip to Brazil and would not be granted a return ticket home.
A raid by labor inspectors found the workers living crammed in lodgings without mattresses.
In one house, 31 workers shared a single bathroom, with food piled on the floor next to personal belongings, in what inspectors described as “degrading conditions.”
At the time, BYD condemned the incidents and said it had removed and barred those involved from the site, instructing its subcontractors to take urgent corrective measures.
“BYD has been operating in Brazil for 10 years, strictly adhering to local laws and maintaining a commitment to ethics, respect, and human dignity,” the company said in a statement.
It also confirmed that affected workers had received support and remained employed at the site.
MPT Lawsuit
In May 2025, the MPT formally sued BYD and two contractors — Jinjiang and Tecmonta (formerly Tonghe) — over alleged human trafficking and conditions “analogous to slavery” affecting around 220 Chinese workers.
The office sought R$257 million ($45 million) in collective damages and pushed for the three companies to be fined R$50,000 ($8,800) for every violation, multiplied by the number of workers harmed.
It also demanded that workers be paid moral damages equal to 21 times their contractual salary, plus an additional full salary for each day they were subjected to the conditions.
Slavery-like Labor Registry
Companies can avoid being added to the slavery-like labor registry by signing an agreement with the government committing to change their practices and compensate affected workers.
According to Reuters, BYD signed a deal with labor prosecutors over the matter, but not with labor inspectors.
Additionally, firms are added to the list only after all government-level appeals are exhausted, and remain on it for two years unless removed by a court decision.
Jinjiang Group denied the claims, with BYD saying it was not aware of any violations until Brazilian media reports emerged in late November 2024.
Brazilian officials have argued that BYD bears ultimate responsibility for its workers’ conditions, as it is expected to supervise its contractors.
Approached by Reuters on Tuesday, the Chinese giant did not respond to a request for comment.
Market Operations
The 2024 scandal triggered international outrage, including in China — and delayed the plant’s construction by several months.
BYD had appeared to move past the matter, with President Luiz Inácio Lula da Silva attending the plant’s inauguration in October as a symbol of strengthening ties between Brazil and China.
The Camaçari facility, in which BYD invested more than R$5.5 billion, began production in July 2025 and is expected to manufacture up to 150,000 vehicles annually for Latin American markets.
The first model produced at the site was the Dolphin Mini, followed by the plug-in hybrid Song Pro SUV and King sedan.
Brazil remains BYD‘s largest market outside China.
The company raised its 2026 sales target to 250,000 vehicles in March, targeting a 10% share of the Brazilian auto market.
BYD delivered more than 112,800 vehicles in Brazil last year and led battery electric vehicle (BEV) registrations in February 2026.
In March, the company delivered over 16,000 vehicles — including both BEVs and plug-in hybrids — and achieved a 6.3% market share in the country.
According to local media outlet The Rio Times, BYD placed four models in the top 50 best-sellers among all powertrains last month.
The compact Dolphin Mini ranked 9th — the highest-ranked Chinese vehicle ever in Brazilian monthly sales.
BYD Labor Costs
While the employees in the Bahia case were not directly employed under BYD — but under a contract with Jinjiang — the case has unfolded against a wider debate over the labor cost advantage of Chinese automakers.
Western chief executives have repeatedly cited it as a structural barrier to competition.
Former Lucid CEO Peter Rawlinson and the current interim CEO Marc Winterhoff, Rivian founder RJ Scaringe and Ford chief executive Jim Farley have all publicly pointed to Chinese labor costs, state subsidies and overcapacity as factors distorting the global EV market.
BYD paid an average of approximately 147,000 yuan ($21,400) per employee in total compensation in 2025, according to an analysis of the company’s annual report.
The figure covers salaries, bonuses, social insurance, and statutory benefits across a year-end headcount of 869,600 employees.
That average is roughly two times lower than the entry-level pay of assembly line workers at Rivian, Tesla and Lucid’s US plants, and around five to six times lower than company-wide averages at Rivian and Lucid.
The cost advantage extends beyond wages, however.
BYD received 12.5 billion yuan in Chinese government subsidies in 2025, according to its annual filing.
The European Commission concluded in its anti-subsidy investigation that Chinese-made BEVs benefit from state support at multiple levels of the supply chain — a finding that led to a 17% countervailing duty on BYD imports into the EU.
BYD‘s 2025 annual report also disclosed the company’s first major workforce reduction, with nearly 100,000 roles eliminated last year alone — bringing headcount down from 968,900 to roughly 870,000.
The cuts were concentrated on production lines, where industrial robots are displacing assembly workers, and fell disproportionately on lower-paid roles.
