by Meredith Stewart, JMA Litigation Director
Hyundai and Kia–two of the world’s largest auto manufacturers–brand themselves as socially and ethically responsible corporations, but as our recent lawsuit alleges, this is far from the truth. Companies in their U.S. supply chain have relied on exploited workers, including children and prisoners, in unsafe working conditions to build parts for their cars.
Our lawsuit, which demands accountability from Hyundai and Kia under the California Unfair Competition Law, alleges that the auto giants misrepresented their compliance with labor laws to win public contracts in California while their U.S. supply chain continued to exploit workers. JMA, the plaintiff in the lawsuit, has spent years documenting labor abuses in the companies’ supply chain in the U.S. South.
Here’s what you need to know.
The Unlawful Practices in Hyundai and Kia’s U.S. Supply Chain
Hyundai and Kia rely on a closely controlled network of auto part companies in Alabama and Georgia to build parts for their vehicles. The lawsuit alleges that those parts suppliers—including some directly owned by Hyundai and Kia—have engaged in severe labor exploitation, targeting vulnerable populations for employment and then exposing them to unsafe working conditions that have led to severe injuries, amputations, and fatalities.
- Hyundai and Kia’s suppliers have relied on coercive prison labor from prison systems in Alabama and Georgia that the U.S. government has found likely have unconstitutional conditions.
- Since 2020, federal and state regulators have identified cases of unlawful child labor at six suppliers in Alabama. Three other suppliers were reported to be using child labor by media outlets that investigated the issue.
- Multiple suppliers have recruited and employed hundreds of migrant workers from Mexico who have sued the companies for fraud, exploitative working conditions, wage theft, and/or labor trafficking.
- Hyundai and Kia suppliers have engaged in widespread noncompliance with health and safety standards that have created deadly working conditions. This year alone, there have been two fatalities at a Hyundai/Kia facility in Georgia.
Though the abuses involve Hyundai and Kia’s suppliers, all roads lead back to the auto manufacturers themselves. The lawsuit details the extent of control and oversight that Hyundai and Kia have over their U.S. suppliers, a corporate model they imported from South Korea.
This top-down approach means Hyundai and Kia have the authority to ensure their suppliers engage in responsible practices, but, in the case of the lawsuit allegations, simply refuse to do so.
Hyundai and Kia’s Sale of Vehicles to California Public Agencies
Together, Hyundai and Kia are the third largest sellers of Electric Vehicles (EV) in the U.S. and are actively marketing their vehicles to California public agencies. These agencies are eager to invest in high-road, “green” companies that can help them meet the state’s EV mandates. Many public agencies have already purchased Hyundai and Kia vehicles for their fleets.
The lawsuit alleges that Hyundai and Kia, through their authorized dealerships, have falsely certified that their vehicles comply with California standards and laws. California and its local governments require that the vehicles they purchase meet strong employment standards and comply with federal and state laws. For example, under California’s Public Contracting Code, contractors must certify that vehicles are not produced with “sweatshop labor,” including child, forced, or prison labor, and that workplaces are safe and lawful. These are precisely the practices that have been documented in Hyundai and Kia’s U.S. supply chain. Yet, Hyundai and Kia have certified that their suppliers are free from “sweatshop” labor practices to win public contracts. The lawsuit calls for an end to Hyundai and Kia’s alleged deception.
An Unfair Edge in the California Market
The lawsuit also alleges that Hyundai and Kia’s deceptive practices harm both California consumers and fair-playing competitors. By systematically violating federal workplace safety laws, the companies gain an unfair edge in the automotive market, boosting profits and enabling them to sell vehicles at below market prices and win public contracts. These practices not only exploit workers but also distort California’s marketplace, undermining the standards designed to protect both consumers and competitors.
Demanding Accountability
Our lawsuit is about holding Hyundai and Kia accountable to workers and the public. We’re asking the court to rule that Hyundai and Kia’s practices violate the law and to order the companies to stop selling their vehicles in California until they submit to a third-party, independent audit to verify that the alleged abusive practices are no longer occurring.
No company is above the law, especially those that receive public dollars.