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South Korea’s Hyundai Motor Group and LG Energy Solutions Ltd (LGES) announced on Thursday that they will build a $4.3 billion battery plant in Georgia as part of a US effort to move battery production to the states.
LGES supplies automakers such as Tesla Inc. and General Motors Co.
Hyundai and LGES will split the investment and construction of the Bryan County, Savannah, Georgia factory will begin in the second half of 2023. Official battery production will start at the end of 2025 at the earliest, Hyundai said in a press release.
“Hyundai Motor Group is focused on its electrification efforts to secure a leadership position in the global automotive industry,” said Jaehoon Chang, President and CEO of Hyundai Motor Company.
“We will lay a strong foundation to drive the global EV transition by building a new EV battery cell plant together with LG Energy Solution, a leading global battery manufacturer and long-standing partner.”
Chung Eui-sun, center left, CEO of Hyundai Motor Group, shakes hands with Georgia Gob. Brian Kemp attends as a dignitary the official groundbreaking ceremony for the Hyundai Meta Plant on October 25, 2022 in Ellabell, Georgia. Hyundai and LG Energy (Richard Burkhart/Savannah Morning News via AP, File/AP Newsroom)
Garrison Douglas, a spokesman for Republican Gov. Brian Kemp, said the 3,000-job battery plant is part of the 8,100 total jobs and the $4.3 billion investment is part of the $5.5 billion total previously announced. Dollar.
The Hyundai/LG plant will have an annual production capacity of 30 gigawatt hours (GWh), enough for 300,000 electric vehicles, it said. Hyundai said the Georgia plant could later expand to produce 500,000 vehicles a year
“This is exactly what we envisioned when Georgia opened the Hyundai Metaplant plant last May, and this project is the latest milestone on Georgia’s path to becoming the country’s electric capital,” said Kemp in a statement.
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LGES said the facility will allow the group to “quickly respond to the increasing demand for electric vehicles in the US market” and “create a stable supply of batteries.”
Hyundai will assemble battery packs from cells from the factory and then ship them to the companies’ manufacturing facilities for the production of the Hyundai, Kia and Genesis EV models, LGES said in a press release.
U.S. President Joe Biden (left) listens to Hyundai Motor Group Chief Executive Officer Euisun Chung at Grand Hyatt Seoul Sunday, May 22, 2022 in Seoul. (AP Photo/Evan Vucci / AP Newsroom)
In addition to the assembly and battery plants, auto parts suppliers have pledged to invest more than $2 billion and hire 4,800 workers in the region around the Hyundai site.
The announcements are part of a rush towards electric vehicles and batteries in the United States.
Auto companies are bringing cheaper electric vehicles to market, even as battery costs increase
Under President Joe Biden’s Inflation Reduction Act, EVs must be assembled in North America and a percentage of their battery parts and minerals must be sourced from North America or a U.S. Free Trade Partner to be eligible for a full $7,500 EV Tax Credit have.
Currently, no Hyundai or Kia vehicles are eligible for the tax credit unless leased. Hyundai refused to exclude foreign-made vehicles, in part because the company builds American factories. Kemp has supported that position, but Democratic Senator Jon Ossoff says Hyundai should wait until it domestically produces vehicles with US-made batteries.
“Once these vehicles are manufactured in Georgia, they may be eligible for the credits through the IRA’s incentives,” Ossoff told reporters in an online news conference Friday morning. “These manufacturing incentives are attracting and accelerating billions of dollars in investment in jobs and advanced energy and electric vehicle manufacturing capabilities here in the state of Georgia.”
Signs are posted in front of the Hyundai Motor Manufacturing Alabama (HMMA) plant in Montgomery, Alabama, USA (Photographer: Luke Sharrett/Bloomberg via Getty Images / Getty Images)
The state of Georgia and local governments have already pledged $1.8 billion in tax breaks and other incentives. According to Greg LeRoy, executive director of Good Jobs First, a group skeptical about subsidies for private companies, it is the largest subsidy package a state has ever promised an auto plant.
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The Associated Press contributed to this report.