Hyundai Motor breaks ground on $5.5 bn EV, battery plant in U.S. ahead of schedule

[Provided by Hyundai Motor Group]

U.S. statesmen and legislators held up champagne served by a robotic dog to toast the launch of South Korean Hyundai Motor Group’s $5.5 billion project to establish its first electric vehicle (EV)-devoted battery plant in Georgia on Tuesday in media extravaganza amidst complaints about loss of tax credit for Korean electric vehicles from new Inflation Reduction Act and ahead of crucial midterm elections.

The shoveling ceremony was celebrated by Chung Euisun, Hyundai Motor Group Executive Chair; Jose Munoz, the president and chief executive officer of Hyundai Motor America; Brian Kemp, Georgia Governor; and senators Raphael Warnock and Jon Ossoff and congressman Buddy Carter.

The project has been hastened since the Korean conglomerate has pledged its biggest ever U.S. investment of $5.5 billion to build its first dedicated EV and battery manufacturing facilities in the Byran County, west of Savannah, just five months ago due to the IRA taking effect in August that immediately restricted consumer tax credit for EV purchases to vehicles assembled in the U.S. From next year, the batteries and parts also must be sourced in the U.S. and its trade partners for tax refund claim.

The EV factory with an initial annual capacity of 300,000 battery-powered vehicles will turn out all models from Hyundai, Kia and Genesis and become fully operational in January 2025.

“Hyundai and the people of Georgia share many qualities: respect for our histories, ingenuity, creativity, and determination to make the world better for the next generation,” Chung said. “Today, our EVs are recognized as best in class, and with this partnership, we are determined to be the global leader in electrification, safety, quality, and sustainability.”

Hyundai Motor’s earlier-than-expected groundbreaking on the new EV factory in the U.S. shows Korea’s commitment, said Cho Tae-yong, the Korean ambassador to the United States, adding that Georgia is a symbol of the economic and technology partnership between the two countries. The EV plant proves that Korean companies are a trusted partner of the U.S., he said.

Cho voiced concerns about the IRA’s negative impact on Korean EV sales in North America during the ceremony, according to U.S media report. But he said both Seoul and Washington are working together to find a solution.

“Our partnership with Hyundai Motor Group and the groundbreaking of this innovative facility exemplifies that unprecedented success,” Governor Kemp said during the ceremony.

The latest investment will not only create thousands of jobs in Georgia but also enhance partnership between Korea and U.S. in smart automobile technology and EV battery sectors, said Don Graves, U.S. Deputy Secretary of Commerce.

He emphasized that Korea is one of U.S.’s largest trading partners with $71 billion investment and that such close economic ties will help support create large-scale jobs in both countries and growth. It will also help the two countries deal with global climate issues.

“This plant was announced during my trip to Korea in May, and I am excited the groundbreaking is happening months ahead of schedule,” U.S. President Joe Biden said according to White House statement.

Shares of Hyundai Motor closed down 1.23 percent at 160,500 won on Wednesday.

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