South Korea’s Hyundai Motor Group and LG Energy Solution Ltd (LGES) announced Thursday that they will build a $4.3 billion electric battery plant in Georgia amid US push to bring battery production to the states.
LGES supplies car manufacturers, including Tesla Inc. and General Motor Co.
Hyundai and LGES will split the investment and construction of the Bryan County, Savannah, Georgia plant will begin in the second half of 2023. Official battery production will not begin until late 2025 at the earliest, Hyundai said in a press release.
“Hyundai Motor Group is focusing 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 build a strong foundation to lead the global EV transition by establishing a new EV battery cell factory with LG Energy Solution, a leading global battery manufacturer and long-standing partner.”
Garrison Douglas, a spokesman for Republican Gov. Brian Kemp, said the 3,000-job battery plant will be part of the 8,100 total jobs and the $4.3 billion investment will be part of the previously announced $5.5 total. billion.
The Hyundai/LG plant will have an annual production capacity of 30 gigawatt hours (GWh), enough to power 300,000 electric cars, they said. Hyundai has said the Georgia plant could later expand to build 500,000 vehicles annually
“This is exactly what we envisioned when Georgia landed the Hyundai Metaplant in May last year, and this project is the latest milestone on Georgia’s path to becoming the country’s EV capital,” Kemp said in a statement.
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LGES said the plant will enable the group to “respond quickly to the rising demand for electric vehicles in the US market” and “create a stable supply of batteries”.
Hyundai will assemble battery packs using cells from the factory and then deliver them to the companies’ manufacturing facilities for production of Hyundai, Kia and Genesis EV models, LGES said in a press release.
In addition to the assembly and battery plants, auto parts suppliers have pledged to invest more than $2 billion and employ 4,800 people in the region around the Hyundai site.
The announcements are part of a rush of electric vehicles and batteries across the United States.
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Under President Joe Biden’s Inflation Reduction Act, electric cars must be assembled in North America and have a certain percentage of their battery parts and minerals sourced from North America or a U.S. free trade partner to qualify for a full EV tax credit of $7,500.
Currently, no Hyundai or Kia vehicles are eligible for the tax credit unless they are leased. Hyundai resisted excluding foreign-made vehicles, in part because it builds American factories. Kemp supported that position, but Democratic Sen. Jon Ossoff says Hyundai should wait until it starts producing vehicles domestically with US-made batteries.
“Once those vehicles are produced in Georgia, they can qualify for the credits through the incentives in the IRA,” Ossoff told reporters Friday morning during an online press conference. “These manufacturing incentives are attracting and accelerating billions of dollars of investment in jobs and advanced energy and electric vehicle manufacturing capabilities here in the state of Georgia.”
The state of Georgia and local governments have already pledged $1.8 billion in tax breaks and other incentives. Greg LeRoy, executive director of Good Jobs First, a group that is skeptical of subsidies to private companies, said it was the largest subsidy package ever promised by a US state to an automaker.
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The Associated Press contributed to this report.