Hyundai, SK On to Set up $5B U.S. EV Battery Plant

South Korean companies Hyundai Motor Group (HYMTF) and SK On, a battery unit of SK Innovation Co Ltd., are establishing an electric vehicle (EV) battery cell production joint venture in Bartow County, Georgia, U.S., with an investment of $5 billion. The two companies will each hold a 50% percent stake in the joint venture.

The new battery plant will be built in the proximity of Hyundai’s U.S. production facilities, including Hyundai Motor Manufacturing Alabama, Kia Georgia, and Hyundai Motor Group Metaplant America. The move comes as more and more EV companies are ensuring that they source their battery components and critical minerals from the U.S. to qualify for the EV tax credits under the Inflation Reduction Act.   

The new plant is expected to commence production in the second half of 2025. It is estimated to have an annual production capacity of 35 gigawatt hours (GWh), which can support the production of 300,000 EVs. Hyundai Mobis will assemble battery packs using cells from the plant and then supply them to the Hyundai Motor Group’s U.S. manufacturing facilities to produce Hyundai, Kia, and Genesis EV models.

On Tuesday, General Motors (NYSE:GM) and Samsung SDI also announced their plan to invest more than $3 billion to build an EV battery plant in the U.S. The plant, which is expected to start manufacturing in 2026, aims to have an annual production capacity of 30 GWh.

Separately, Hyundai Motor Company (an affiliate of Hyundai Motor Group) announced upbeat Q1 2023 results. The company’s revenue increased 25% to 37.8 trillion won, while its net profit jumped 92.4% to $3.42 trillion won. Vehicle sales increased 13% year-over-year to 1,021,712 units in Q1 2023. The company attributed the strong sales to improvement in the supply of chips and other components. Hyundai Motor sold about 66,000 EV units in Q1, marking a 48% year-over-year rise.  

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