Two men have been accused of stealing Tesla trade secrets to set up their own electric vehicle battery manufacturing business in China.

One of the men, Canadian citizen Klaus Pflugbeil, 58, was arrested Tuesday by authorities on Long Island, New York. He was lured to the arrest location by undercover federal agents posing as possible business partners. Mr. Pflugbeil’s business partner, Yilong Shao, a 47-year-old Chinese citizen, is still at large.

Both men officially live in Ningbo, China.

Authorities have charged the two with conspiracy to transmit trade secrets and say the two set up a company in China using stolen proprietary information from U.S. companies. The two face up to 10 years in prison if convicted.

According to authorities, the pair worked for a company that developed technology for high-speed assembly lines used in producing electric vehicles. The unnamed company was bought in 2019 by a “leading manufacturer of battery-powered electric vehicles and battery energy systems.”

Prosecutors say Mr. Shao and Mr. Pflugbeil founded their business in China in 2020. The company allegedly uses Tesla‘s proprietary technology to manufacture similar battery assembly lines. Since 2020, the business has expanded into Brazil, Canada and Germany.

In 2019, the Canadian-based battery manufacturer Hibar Systems is where Mr. Pflugbeil and Mr. Shao could have worked.

• Vaughn Cockayne can be reached at vcockayne@washingtontimes.com.