The answer was found over on the Apple Developer forums in a thread titled Xcodebuild error Swift Package with -derivedDataPath. That thread links back to this forum and got me to this post: Xcode and Swift Package manager - #6 by simonpierreroy.
It seems that -derivedDataPath
cannot be in the current working directory or if it is then the SwiftPM cache should not be. I am using -clonedSourcePackagesDirPath
to move the SwiftPM cache outside the current working directory.
Solution
xcodebuild \
-disableAutomaticPackageResolution \
-usePackageSupportBuiltinSCM \
-derivedDataPath "$PWD/derivedData" \
-clonedSourcePackagesDirPath "$HOME/Library/Developer/Xcode/DerivedData/$XCODE_SCHEME"
-enableCodeCoverage YES \
-scheme "$XCODE_SCHEME" \
-destination "$DESTINATION" \
build-for-testing