Brazilian authorities have halted construction of a factory by Chinese electric car giant BYD, saying workers’ living conditions were comparable to “slaves.”

More than 160 workers have been rescued, according to the northeastern Brazilian state of Bahia. Statement from the Public Labor Prosecutor’s Office (MPT).

They were allegedly kept in “degrading” conditions and a construction company withheld their passports and wages.

BYD said in a statement that it had severed ties with the company involved and remained committed to “full compliance with Brazilian legislation.”

The factory is scheduled to be operational in March 2025 and will be BYD’s first electric vehicle factory outside Asia.

The workers were employed by Jinjiang Construction Brazil and lived in four factories in the city of Camassari.

At one facility, workers were forced to sleep on beds without mattresses, prosecutors said.

Each bathroom is shared by 31 workers, forcing them to wake up very early to get ready for work.

“The conditions inside the residence showed an alarming level of instability and degradation,” the MPT said.

As defined by Brazilian law, “conditions similar to slavery” include debt bondage and work that violates human dignity.

The MPT added that the situation also constituted “forced labor” as many workers had their wages withheld and faced exorbitant costs of terminating their contracts.

BYD said the affected workers had been moved to hotels.

The company added that it had conducted a “detailed review” of the working and living conditions of its subcontracted employees and had “repeatedly” asked the construction company to make improvements.

BYD, short for “Build Your Dreams,” is one of the world’s largest electric vehicle manufacturers.

It sells more electric cars than Elon Musk’s Tesla The final three months of 2023 see the two companies vying for top spot in the field.

The company has also been expanding its foothold in Brazil, its largest overseas market.

The company first opened a factory in São Paulo in 2015 to produce electric bus chassis.

Last year, the company announced it would invest 3 billion reais ($484.2 million) to build an electric vehicle manufacturing plant in Brazil.

Electric vehicle sales in China are driven by government subsidies. This encourages consumers to switch from gasoline-powered cars to electric or hybrid vehicles.

But what some see as unfair support for domestic automakers by the Chinese government has prompted a growing backlash overseas.

Major markets such as the United States and the European Union have already imposed tariffs on electric vehicles from China, with more tariffs expected under President-elect Donald Trump.