Kia will begin producing hybrid vehicles at Hyundai Motor’s new U.S. factory in Georgia starting in mid-2026, the company’s chief executive said on Wednesday, as the South Korean automaker adapts to evolving market trends.
The facility, originally planned as an all-electric vehicle (EV) plant, will now include hybrid production in response to cooling demand for fully electric cars. Kia’s hybrid models will account for 40% of the plant’s total output, CEO Song Ho-sung told reporters during the facility’s opening ceremony. He did not specify which models will be produced.
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Hyundai, which broke ground on the Georgia plant in 2022 under policies promoting EV adoption, has revised its strategy as political and market conditions shift. President Donald Trump’s administration has signaled plans to roll back EV subsidies, while the company is also responding to consumer preferences. Hyundai aims to increase the plant’s production capacity from an initial 300,000 vehicles annually to 500,000.
Song said the new U.S. production line will support Kia’s goal of increasing its annual U.S. sales to 1.25 million vehicles, up from the current 850,000. “The new facility will be a key part of our growth strategy in the U.S. market,” he said.
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The expansion comes amid broader industry concerns over tariffs. On Wednesday, Trump announced a 25% import tariff on cars and auto parts, a move that could affect major Asian automakers, which are among the largest vehicle exporters to the U.S. According to S&P data, South Korea is the second-largest supplier of vehicles to the U.S., following Mexico.
Kia currently manufactures most of its hybrid models, including the Sportage hybrid crossover, in South Korea. The shift to U.S. production reflects a strategic move to strengthen its foothold in a key market while responding to changing regulatory and consumer trends.