On Thursday, Hyundai Motor Group and LG Energy Solution announced an additional $2 billion Invested to Boost Battery Production. Additionally and the hiring of 400 more workers to produce batteries at Hyundai’s upcoming electric vehicle plant in Georgia, USA.
This update builds upon the partnership between these South Korea based companies.
A major car maker and a leading producer of lithium ion batteries, which was initiated three months ago. The batteries will be manufactured at the same site as Hyundai’s EV production facility, scheduled to begin operations in 2025.
With this latest announcement, the total investment in the Georgia plant by Hyundai and LG reaches over $7.5 billion. Further supporting a planned workforce of 8,500 individuals.
“This additional investment in Bryan County demonstrates our ongoing dedication to a more sustainable future powered by American workers,” stated José Muñoz, President and Global Chief Operating Officer of Hyundai Motor Company.
Billions Committed:
In 2022, Hyundai had already committed $5.5 billion for the assembly of electric vehicles and batteries on a vast 2,900 acre piece of land in Ellabell.
However, the newly announced investment and job creation do not indicate increased battery production at the Hyundai/LG battery plant. According to Hyundai spokesperson Michael Stewart, the plant is still expected to supply batteries for 300,000 EVs annually.
“Depending on demand, the plant has potential for expansion,” Stewart added, expressing Hyundai’s optimism about the transition to electric vehicles.
Initially, the Georgia plant plans to manufacture 300,000 vehicles each year, with the possibility of future expansion to reach an annual production capacity of 500,000 vehicles.
When it was first announced, Hyundai’s establishment of their first dedicated EV manufacturing plant in the United States was celebrated as the largest economic development project in Georgia’s history. Since then, suppliers have committed to investing nearly $2.2 billion and hiring 5,000 employees.
“Today, we are further building upon that success as we strive to make Georgia the e mobility capital of the nation,” stated Georgia Governor Brian Kemp, commending Hyundai and LG for their additional investment to boost battery production in the plant.
Government incentives:
Additional incentives from Georgia and local governments will be provided, according to Jessica Atwell, a spokesperson for the state Department of Economic Development. However, the details of these incentives will be disclosed after the finalization of documents.
Already, state and local governments have pledged $1.8 billion in tax breaks and other incentives. This new investment to boost battery production will allow the company to claim further tax breaks as permitted by law. This includes an additional $10 million in state income tax credits over a span of five years.
Atwell mentioned that discretionary incentives such as infrastructure aid and equipment subsidies may also require additional expenditures from state and local governments.
According to Greg LeRoy, Executive Director of Good Jobs First, a group skeptical of subsidies to private companies. The Hyundai package is already considered the largest subsidy package ever promised by a U.S. state to an auto plant.
Battery industry trend:
These announcements are part of the growing electric vehicle and battery industry trend across the United States. Under the U.S. Inflation Reduction Act, electric vehicles must be assembled in North America. A certain percentage of their battery parts and minerals should come from North America or a U.S. free trade partner to be eligible for a full $7,500 EV tax credit.
Currently, Hyundai and Kia vehicles do not qualify for the tax credit unless they are leased. Hyundai has opposed the exclusion of foreign made vehicles from eligibility, in part because they are establishing factories in America.
In addition to the vehicles produced in Ellabell, Hyundai will require batteries for its electric vehicles made in Montgomery. They also announced plans to assemble their electric Kia EV9 large SUV at the Kia plant in West Point, Georgia, starting in April.