Hyundai Motor Group and LG Energy Solution have revealed plans to construct a new electric battery plant worth $4.3 billion as part of Hyundai’s forthcoming electric vehicle assembly plant in southeast Georgia. This joint investment will be split evenly between the two companies, with production set to commence by late 2025.
The battery plant aims to provide a robust foundation for Hyundai’s global transition to electric vehicles and accelerate the production of electrified Hyundai and Kia vehicles in North America. Hyundai Motor Co. CEO Jaehoon Chang expressed confidence in their electrification efforts, emphasizing the company’s determination to secure a leading position in the global auto industry.
The upcoming Hyundai assembly plant, situated outside Savannah, Georgia, will focus on manufacturing six electric models and is expected to begin operations in early 2025. Spanning across a 2,800-acre site, the project will initially have a production capacity of 300,000 electric vehicles annually, with the potential to increase to 500,000 vehicles based on demand.
Governor Brian Kemp’s spokesperson, Garrison Douglas, confirmed that the battery plant, creating 3,000 new jobs, is included in the overall plan to generate 8,100 jobs and invest $5.5 billion in Ellabell, Georgia. Kemp expressed enthusiasm, stating that this project aligns with their vision of making Georgia the nation’s EV capital.
By diversifying their battery supplier base, Hyundai aims to establish redundancy and gain access to batteries with different form factors and chemistries. This strategy provides original equipment manufacturers (OEMs) like Hyundai the flexibility to design and market electric vehicles with varying performance levels, range, and price points. Conrad Layson, a senior analyst at AutoForecast Solutions, emphasized that diversifying battery suppliers alleviates OEMs’ dependence on any single supplier and mitigates the risk of supplier issues.
The Hyundai/LG partnership follows a similar agreement with South Korean battery supplier SK On Co. for a $5 billion battery plant in Bartow County, Georgia. This plant, expected to commence production by 2025, will primarily supply Hyundai Motor Group auto plants in West Point, Georgia, and Montgomery, Alabama.
The establishment of these battery plants and the subsequent expansion of the vehicle assembly plant mark significant milestones in Georgia’s journey to become the nation’s hub for electric vehicles. In addition to the employment opportunities provided by Hyundai and LG, various auto parts suppliers have pledged over $2 billion in investments and the creation of 4,800 jobs in the surrounding region.
The surge in electric vehicle and battery investments across the United States can be attributed to the U.S. Inflation Reduction Act, which mandates that EVs be assembled in North America and a certain percentage of their battery parts and minerals come from the region or a U.S. free trade partner to qualify for a $7,500 EV tax credit.
With this latest development, Hyundai strengthens its commitment to electric mobility, aligning with its global investment plans of $16 billion for EVs by 2030 and a target to sell 3.23 million battery-powered vehicles worldwide within the same timeframe. In the first quarter of 2023, Hyundai and Kia delivered approximately 119,000 EVs, reflecting a slight decline of 2.2 percent compared to the previous year.
LG Energy Solution, which already operates or is constructing seven battery plants in the United States, underscores the allure of federal incentives that are attracting manufacturers to expand production within the country. The Hyundai/LG collaboration provides Hyundai with multiple battery suppliers, enhancing its supply chain resilience and reducing reliance on a single manufacturer.
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