Below variables contains hard coded build paths from the host: LTCC= lt_sysroot= sys_lib_search_path_spec= LD= CC= compiler_lib_search_dirs= predep_objects= postdep_objects= compiler_lib_search_path= The issue is related to SDK. Those variables are not updated by SDK install script (or it's relocate_sdk.py) and even if some (CC, LD) are overriden by $ source source environment-setup-<MACHINE>-wrs-linux, the other like lt_sysroot remains unchanged in the installed SDK and use as it (containing hardcoded paths from build dir).
$ make -C build libtool # file <projectDir>/bitbake_build/tmp/work/.../libtool/2.4.2-r6.0/libtool-2.4.2/libtool