BYD Stock (BYDDY) is Bashed after New Brazilian EV Backlash

Shares in Chinese EV maker BYD (BYDDY) reversed nearly 2% today as it faced a new backlash in Brazil over its expansion plans.

Rivals Spluttering

Brazilian car manufacturers have been left spluttering over the huge recent influx of cars from BYD into the South American country, concerned about what it means for domestic sales and jobs.

According to a Reuters report, BYD has deployed a growing fleet of cargo ships to accelerate its expansion overseas, with Brazil becoming its top target. It recently sent one cargo ship carrying reportedly the equivalent of 20 football fields worth of BYD cars into Brazil’s Itajai port.

This late-May shipment was the fourth of the Chinese carmaker’s ships to dock in Brazil this year, totaling around 22,000 vehicles.

Apparently this has revved up anger among Brazilian car industry and labor groups who claim that China and BYD are taking advantage of the nation’s temporarily low tariff barriers to ramp up exports at the expense of building Brazilian factories and jobs.

EV Tariff Plea

They want the Brazilian government to take action, calling for it to accelerate by a year a plan to increase Brazil’s tariff on all EV imports to 35% from 10%, rather than gradually phasing in the rises.

The call adds to BYD’s growing pains in Brazil.

Last month the Public Labor Prosecutor’s Office (MPT) in the state of Bahia said it was suing BYD and two of its contractors, accusing them of human trafficking and creating conditions “analogous to slavery” at a factory construction site.

The MPT said it had rescued 220 Chinese workers after receiving an anonymous complaint. It is now seeking $45.5 million in damages from the three firms.

But BYD’s goal of seeking to dominate overseas markets is likely to continue. It has a target to sell half of its vehicles outside the Chinese market by 2030 in response to an increasingly competitive EV market both at home and abroad.

Brazil is attractive as it is the sixth-largest market in the world by volume with established players like General Motors (GM) and Stellantis (STLA). It is also committed to growing the number of EVs and hybrid cars on its streets, especially ahead of hosting the COP 30 climate conference later this year.

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