by Main Content of the Lawsuit
A new lawsuit against Hyundai and Kia in the United States demands to block the sale of their cars in California due to so-called “unconscionable labor practices.” The case focuses not on the cars themselves, but on how the automakers allegedly source parts and labor through their supply chains in the southern US.
The lawsuit claims that both brands violated California’s Unfair Competition Law by relying on suppliers accused of “illegal and unethical labor practices.”
Arguments of the Lawsuit
The complaint was filed by the non-profit group ‘Jobs to Move America’ with the California Superior Court. Its central argument is that while Hyundai and Kia positioned themselves as socially responsible to California government agencies, which allowed them to receive state contracts, they actually operate in ways contrary to the state’s “high” labor standards.
These standards prohibit the use of state funds for purchasing goods produced using sweatshop, forced, prison, or child labor. According to the lawsuit, Hyundai and Kia suppliers in the southern US rely on all three types.
The document claims that by asserting compliance with California’s high standards, “Hyundai and Kia are misleading California government agencies and consumers and giving themselves an unfair competitive advantage over responsible companies.”
Child Labor Allegations
In mid-2022, Hyundai faced criticism in the United States after an investigation revealed that at least four of its major suppliers in Alabama used migrant children as young as 12 years old for work.
Meredith Stewart, Litigation Director for Jobs to Move America, stated: “No company is above the law — especially companies like Hyundai and Kia that benefit from public funds. This case says that with Hyundai and Kia’s persistent refusal to take responsibility for the abhorrent labor practices in their southern supply chain. California residents — and American workers — deserve better.”
The lawsuit demands a declaratory judgment confirming Hyundai and Kia’s violations of California laws, along with a permanent court injunction providing for independent audits, third-party monitoring, and ongoing compliance review.
Hyundai’s Response
Hyundai categorically rejected the allegations, calling them “baseless” in a statement released to the press. The company states that it “prioritizes the safety and well-being of our workforce above all else and fully complies with all federal and state regulations.”
“We require our suppliers and business partners to adhere to Hyundai’s stringent safety, employment, and legal standards, and take decisive action when violations occur,” the company stated.
“For nearly four decades, Hyundai has been a driver of American growth and innovation from its U.S. headquarters in Fountain Valley, California, and we value our long-term relationship with the state. Hyundai is a major economic participant in the communities where we operate and is committed to providing good jobs with competitive wages and benefits,” the company added.
This lawsuit emerges against the backdrop of nationwide attention to hiring practices in the automotive industry, particularly in regions with high concentrations of migrants. The success or failure of this case could set an important precedent for how states regulate global supply chains, and whether labor standards can influence access to major markets like California. The long-term implications for brand reputation and consumer preferences also remain in question, as buyers increasingly consider ethical factors when choosing vehicles.
