Hyundai and LG plan to build a $4.3 billion battery factory near Savannah

Another huge manufacturer of electric vehicle batteries is coming to Georgia.

Hyundai Motor Group and LG Energy Solutions announced plans late Thursday to spend $4.3 billion to build an electric vehicle battery manufacturing plant in Bryan County near Savannah as part of the largest economic development project in state history.

The project will be built near Hyundai’s massive electric vehicle “Metaplant” under construction in Ellabell, and state officials say it will be part of the company’s previously announced plan to spend $5.5 billion on the new complex and create 8,100 jobs.

The South Korean-based companies said Thursday that the battery plant will create 3,000 of those jobs and that batteries made at the upcoming plant will power Hyundai, Kia and Genesis models produced at U.S. facilities, the companies said in a statement.

In a statement, Hyundai Motor CEO Jihoon Chang said the company is focused on efforts to produce electric vehicles in North America, and this project will help “create a solid foundation to lead the global electric vehicle transformation.”

The plant is expected to start up later this year and will start producing batteries by the end of 2025. Once complete, the plant will be able to build enough batteries annually for 300,000 electric vehicles.

Hyundai is already developing another major battery plant in Georgia. The automaker and an affiliate of SK Innovation said in December that they would build a factory near Cartersville that could total an investment of $5 billion and create 3,500 jobs.

The latest development adds to a string of electric vehicle manufacturing plants and battery facilities that have already opened in Georgia or are on their way to the state.

Rivian is building a $5 billion electric vehicle plant about an hour east of Atlanta. Dozens of parts and materials suppliers are opening factories in the state to feed the growing EV ecosystem. State officials say they have a pipeline full of other projects they aim to recruit.

The new projects also build on the close ties between Georgia and South Korean officials. Governor Brian Kemp made South Korea the site of his first overseas trade mission in 2019, and US Senator Jon Ossoff has embarked on two official trips there, including one in April.

Georgia lured the Hyundai plant last year with a package of tax breaks and other incentives worth $1.8 billion, breaking the previous record for the state. It was not immediately clear if any additional incentives had been offered to Hyundai and LG to finalize plans for the battery plant.

Georgia leaders immediately hailed the new plant as a display of the strength of the state’s developing economy, though they sharply disagreed about why the companies should choose Georgia.

Ossoff, a Democrat, said the landmark Climate and Health Care Act signed into law by President Joe Biden last year was key to securing the investment. The law includes billions in investment and production tax credits for electric vehicle and battery manufacturers.

“The IRA’s manufacturing incentives continue to bring jobs and investment to Georgia,” Ossoff said, referring to the law to lower inflation. “My goal remains to make Georgia the world leader in advanced energy production.”

Kemp, who visited Israel this week with a trade delegation from Georgia, credited the “strong, carefully built partnerships nationwide” with the two companies. He and other state officials said Thursday’s announcement laid out the final details of the project that have been worked out before the federal tax measure is signed into law.

“This is exactly what we envisioned when Georgia landed the Hyundai Metaplant in May of last year, and this project is the latest milestone on Georgia’s path to becoming the electric vehicle capital of the nation,” Kemp said.

Pat Wilson, the state’s chief economic development official, said the new details are the result of South Korean companies “sharpening their pens on jobs, investment, and the long-term outlook based on actual real numbers on the ground and more accurate market forecasts.”

Georgia officials have enlisted a series of mega projects linked to the transition away from fossil fuels, including a major expansion of solar power giant Qcells. But they disagreed about the impact of federal tax and climate measures, which Congress passed without Republican support.

Kemp recently told The Atlanta Journal-Constitution that he supports repealing the legislation, which he said should not have “passed in the first place.” But he said Biden should at least adjust regulations to allow Hyundai and other manufacturers with ongoing projects to take advantage of breaks.

This indicates a rule in law This would require all EVs to undergo final assembly in North America to qualify for the $7,500 customer tax credit. Since Hyundai’s Georgia auto plant won’t operate until 2025, customers could lose out on the break until then.

We have tried to bring these high quality and innovative manufacturing jobs back to the United States. “That’s what President Biden has campaigned for,” Kemp said. “Now he’s sanctioning those companies, and he’s picking winners and losers with the bill he passed.”

In a recent interview, Ossoff took a different approach. He said both sides should rejoice in the clean energy incentives that have made Georgia a magnet for the industry. He said Hyundai could take advantage of the breaks once it starts producing cars in Georgia.

“Georgia has benefited more than just about any other country in the country from these manufacturing incentives,” Ossoff said. “We should celebrate that rather than politicize it, because Georgia’s economic development should be a team sport, not a political contest.”