Hyundai Motor, LG Energy Solution to invest $4.3 bn in US battery plant
Seoul, May 26 (IANS) South Korea's Hyundai Motor Group and LG Energy Solution said on Friday they will invest 5.7 trillion won ($4.3 billion) in a battery cell plant in the United States, with an aim to begin operations in 2025.
The two companies will set up a 50:50 joint venture within this year to build the plant with an annual capacity of 30 gigawatt-hours near Hyundai Motor Group's dedicated electric vehicle (EV) and battery plant under construction in Georgia, they said in separate statements.
The joint company will supply battery cells for EVs manufactured at Hyundai Motor Co.'s Alabama plant, its smaller affiliate Kia Corp.'s Georgia plant, and the upcoming dedicated EV and battery plant named the Hyundai Motor Group Metaplant America (HMGMA), reports Yonhap news agency.
"Hyundai Motor Group is shifting its focus to electrification and aims to become a leader in the global EV market based on the battery cell plant project," Hyundai Motor President and CEO Chang Jae-hoon said in a statement.
Their joint investment comes as the Inflation Reduction Act (IRA), signed into law by U.S. President Joe Biden in August, requires EV batteries to be made with a certain proportion of minerals mined or processed in the U.S. or countries or regions that have free trade agreements with Washington.
The IRA gives up to $7,500 in tax credits to buyers of EVs assembled only in North America, sparking concerns that Hyundai Motor and Kia could lose ground in the U.S. market, as they make most of their EVs at domestic plants for export to the U.S.
In October, Hyundai Motor Group began the construction of a 300,000-unit-a-year EV and battery plant in Georgia, aiming to begin commercial production in the first half of 2025.
Early this year, Hyundai Motor began to produce the all-electric GV70 SUVs under its independent Genesis brand at the Alabama plant.