Hyundai Motor Group and LG Energy Solution have announced their plans to construct a $4.3 billion electric vehicle (EV) battery plant in the United States. This strategic move aims to capitalize on tax credits and comply with new U.S. sourcing requirements for EV battery components and critical minerals.
The establishment of the battery plant is particularly significant as it enables buyers of Hyundai and Kia vehicles to qualify for up to $7,500 in tax credits under the Inflation Reduction Act. Presently, vehicles from Hyundai Motor and its sister company, Kia, do not meet the eligibility criteria for these tax credits.
The construction of the battery plant is slated to commence in the second half of 2023 in the state of Georgia. Battery production is expected to commence no earlier than the end of 2025. Once operational, the facility will possess an annual production capacity of 30 gigawatt-hours, which will be sufficient to power around 300,000 electric vehicles.
Hyundai Motor Group, recognized as the world’s third-largest automaker based on vehicle sales, has been actively investing in electric vehicle and battery manufacturing facilities. This upcoming battery plant will be situated in Bryan County, Georgia, where Hyundai’s joint factory with LG Energy Solution will also be located.
Both LG Energy Solution and Hyundai Motor Group, which encompasses Hyundai Motor, Kia, and auto parts manufacturer Hyundai Mobis, will hold equal ownership stakes of 50% in the joint venture. LG Energy Solution, a major battery supplier, currently provides batteries to automakers such as Tesla and General Motors.
Expressing enthusiasm about the collaboration, LG Energy Solution CEO Youngsoo Kwon stated, “Two strong leaders in the auto and battery industries have joined hands, and together we are ready to drive the EV transition in America.” This partnership between Hyundai and LG Energy Solution signifies their collective commitment to advancing the adoption of electric vehicles in the United States.
In April, Hyundai Motor Group solidified another significant milestone by establishing a $5 billion EV battery joint venture with SK On, a battery unit of SK Innovation, further bolstering their electrification endeavors in the U.S. market.
With the establishment of the new battery plant in the United States, Hyundai Motor Group and LG Energy Solution are poised to strengthen their foothold in the rapidly expanding electric vehicle sector. This collaboration demonstrates their shared vision to drive the transition towards sustainable and eco-friendly transportation options.
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