Hyundai Motor Group (HMG), comprising Hyundai Motor and Kia Corporation, plans to invest KRW7trn (US$5.2bn) to build two electric vehicle (EV) battery plants in the US in separate joint venture (JV) deals with SK On and LG Energy Solution (LGES).
Hyundai Motor Group (HMG), comprising Hyundai Motor and Kia Corporation, plans to invest KRW7trn (US$5.2bn) to build two electric vehicle (EV) battery plants in the US in separate partnerships with South Korean battery manufacturers SK On Company and LG Energy Solution (LGES).
Details of the investment plan emerged following the recent US government announcement (after much lobbying) of tax credits worth up to US$7,500 for EVs produced locally by HMG.
To qualify for the full tax credit, 50% of the battery components (by value) must be produced in North America with 40% of the critical minerals sourced either in the US or from a foreign country with a free trade agreement with the US.
According to local reports, an HMG board meeting was scheduled for tomorrow (25 April) to sign off the two joint ventures, with a formal announcement expected to be made next week during the US visit of South Korean president Yoon Suk Yeol.
The largest investment, for KRW4trn, will go into the LGES JV to establish capacity for 35 gigawatt-hour (GWh) of batteries per year, enough for 400,000 EVs. The plant will supply batteries to Hyundai’s car plant in Montgomery, Alabama and the Kia factory in West Point, Georgia.
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The second plant, with a KRW3trn spend, will be built by a JV with SK On with capacity of 25 GWh per year. The 50/50 JV was scheduled to begin operations in 2025, supplying batteries to Hyundai’s first dedicated EV plant currently under construction in Savannah, Georgia.
HMG has set an annual sales target for the US of 500,000 EVs per year by 2026, rising to a million by 2030, supplied by new EV plants currently under construction and existing factories to be converted for EV production.
To achive this goal, HMG is understood to be in discussions for an additional US battery plant built by the LGES JV with capacity for 30 GWh per year.