Georgia raid costs Korean firms millions as work grounds to a halt

A sweeping immigration crackdown at the LG Energy Solution-Hyundai Motor joint battery plant in Georgia has brought the U.S. factory construction projects of other Korean battery makers to a virtual halt, triggering concerns across the industry.

A joint battery factory operated by Hyundai Motor Group and LG Energy Solution in Georgia [KANG TAE-HWA]

A sweeping immigration crackdown at the LG Energy Solution-Hyundai Motor joint battery plant in Georgia has brought the U.S. factory construction projects of other Korean battery makers to a virtual halt, triggering mounting concerns across the industry.

With over 300 Korean workers detained on suspicion of visa violations on Sept. 4, companies are now grappling with delays, revenue loss, increased financial burdens and reduced subsidies.

Following the raids, Korean expatriates swiftly returned home, and fears of additional enforcement have effectively frozen new deployments. Only essential personnel with L-1 visas and local employees remain at work, but progress on the facilities has stalled.

LG Energy Solution is building four battery plants across Georgia, Arizona, Michigan and Ohio, all of which are now facing delays. SK On has completed major construction work at its site, but may see further delays in the start of operations due to visa issues affecting equipment technicians.

A 50 gigawatt-hour battery facility suffers production losses of up to $4 million per day, according to a McKinsey & Company analysis. Applying that to the plant’s 30 gigawatt-hour capacity, daily losses are estimated at $2.4 million. Factoring in rising borrowing costs and declining customer confidence, the total damage could climb much higher.

This image from video provided by U.S. Immigration and Customs Enforcement via Dvids shows manufacturing plant employees waiting to have their legs shackled at a joint battery factory operated by Hyundai Motor Group and LG Energy Solution in Ellabell, Georgia, on Sept. 4. [AP/YONHAP]

Seoul has long urged Washington to introduce a dedicated E-4 work visa quota for Korean engineers and clarify the scope of business B-1 visas. But anti-immigration sentiment in Congress has stalled any progress.

Compounding the problem is the high reliance on Korean and Japanese equipment, which makes it difficult to replace foreign experts with local workers.

Among those detained were 47 LG Energy Solution employees, three Japanese nationals and 156 subcontracted workers from Hyundai Engineering who were handling interior construction.

Korean Embassy officials leave an Immigration and Customs Enforcement detention facility in Folkston, Georgia, on Sept. 8 after holding talks regarding LG Energy Solution and Hyundai Motor battery plant construction workers who were arrested in an immigration raid. [YONHAP]

“Large-scale projects simply cannot be managed without Korean supervisors,” said an industry source. “Relying solely on U.S. workers to run these sites is not feasible.”

Adding to the strain are conditions set by U.S. President Donald Trump that require companies dispatching foreign workers to also commit to training local employees. Although LG Energy Solution is considering dispatching replacement staff, visa issuance and hiring processes are expected to delay operations significantly.

Workers from the LG Energy Solution-Hyundai Motor battery plant construction site in Georgia stand in line in blue uniforms at the Folkston detention center on Aug. 8, with documents in hand. [KANG TAE-HWA]

The labor disruptions are also threatening companies' access to the Advanced Manufacturing Production Credit (AMPC), a key incentive under the U.S. Inflation Reduction Act.

LG Energy Solution received 1.4 trillion won ($1 billion) in AMPC credits last year, far exceeding its 575.4 billion won in operating profit. A prolonged delay could impact its earnings forecast for next year.

“This incident is expanding uncertainty in U.S.-based operations,” an industry source said. “Visa reform must become the top priority, and both governments need to resolve the issue quickly to restore business stability.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom. BY JEONG JAE-HONG [kim.minyoung5@joongang.co.kr]