Georgia Department of Economic Development Commissioner Pat Wilson made his latest trip to South Korea in March, when the Hyundai Motor Group’s record-breaking $5.54 billion investment in the state, announced this Friday, had yet to be buttoned up.
In addition to visiting with existing investors and new prospects, Mr. Wilson dropped in on the Hyundai leadership team at the group’s headquarters in Seoul, a tower emblazoned with the logos of both Hyundai and Kia, the sister auto makers that for more than a decade have operated plants along Interstate 85 straddling either side of the Georgia-Alabama line.
Mr. Wilson’s trip was the latest touchpoint in a relationship with Hyundai Motor Group more than 15 years in the making, and in a decades-long courtship of Korea by the state, which has operated an investment and trade office there since the 1980s.
Georgia Gov. Brian Kemp, for his part, took his first economic-development mission as governor to the country in 2019, just after the state declined to renew the contract for its investment recruiter in China. Mr. Wilson told Global Atlanta then that it was time to dedicate more resources to the Korean market.
The state had already won an SK Innovation electric-vehicle battery plant valued at $1.7 billion at the time, an investment that has now ballooned to a planned $5.2 billion — for a time the largest project in the state’s history.
Hyundai Motor Group’s announcement Friday made Mr. Wilson’s plan look even more prescient. The company will build its first dedicated EV and battery plant outside Korea on a 2,284-acre mega-site in Bryan County, about 30 miles from Savannah. On top of the $5.5 billion plant, another $1 billion in investment is expected from suppliers, resulting in an expected total of 8,100 jobs for Georgians.
“(The shift from China) definitely has borne fruit,” Mr. Wilson told Global Atlanta in an interview Friday. “It was a strategic decision we made based on where we were seeing the most activity, and not only yet most activity but the most advanced activity. You’re talking about the jobs of the future that are in battery tech, electric vehicles and renewable energy, so it just made a lot of sense for us to really right-size our contracts and focus on where the most leads were coming from.”
Mr. Wilson conceded that a bit of “dumb luck” also helped. Just as Georgia deepened its focus on South Korea, a consensus emerged in Washington that China’s rise was no longer benign, and that especially in certain sensitive economic sectors, it was better to work with friends than adversaries.
The COVID-19 pandemic and its resulting supply-chain challenges only exacerbated the trend, and the Biden administration entered the White House in 2021 signaling a strong commitment to electric vehicles as a means to curb climate change.
Korean firms in industries like semiconductors, medical items and electric vehicles responded with plans to localize production in the United States, making landmark announcements during Moon Jae-in’s summit with Mr. Biden last year, after which the then-Korean president came down to see Georgia’s SK Battery plant. Around that same time, Hyundai said it would invest $7.4 billion in the U.S. to make electric vehicles, but it didn’t announce where.
Georgia’s Friday coup comes as Mr. Biden travels in South Korea on an Asian mission focused on shoring up alliances through commercial diplomacy. The U.S. president met May 20 with newly elected Korean President Yoon Suk-yeol, and the two toured a Samsung semiconductor factory to give a taste of what the conglomerate will build in Texas to alleviate the global chip shortage.
Mr. Kemp, the Georgia governor, has been a strident critic of Mr. Biden’s economic record, but on the electric-vehicle front, they have found an issue that both can get behind, albeit for divergent reasons and without acknowledging the other.
After announcing a concerted effort to attract companies along the entire EV supply chain, Mr. Kemp found himself Friday marking for the second time this fiscal year an EV project constituting the state’s largest-ever investment. Electric truck maker Rivian Automotive briefly held the record, announcing plans in December to invest $5 billion and create 7,500 jobs in Covington, where some local opposition has emerged.
“The automotive industry will see more change in the next 10 years than in the prior 100, and that’s something to think about,” Mr. Kemp said in announcing the Hyundai investment beneath a tent erected at the Bryan County megasite. “We have long prepared and planned for that revolution.”
Hyundai’s plant may be less controversial than Rivian’s; it sits on a massive piece of property the state bought a year ago with input from the Savannah-Interstate 16 Joint Development Authority, an alliance of four counties: Bryan, Bulloch, Chatham and Effingham.
Standing at the Bryan Co. Megasite, I was reminded of a Korean proverb: “If you lift together, it’s better – even if it’s a sheet of paper.”@HMGnewsroom CEO Jay Chang & I signed such a paper today to officially launch this project – a culmination of the partnerships of so many. https://t.co/81tB45922M pic.twitter.com/JLoSBV0BFB
— Governor Brian P. Kemp (@GovKemp) May 20, 2022
Hyundai Motor Group is also a more established player. Its three brands — Hyundai, Kia and the luxury mark Genesis — captured more than 10 percent market share in the United States last year, eclipsing that of Japanese mainstay Honda. The group has outlined ambitious plans to transition away from internal combustion engines, with Kia targeting 14 battery-electric models by 2027 and Hyundai and Genesis set to sport a combined 17 electric models by 2030, according to Automotive News. By the end of the decade, the group plans to have produced 3.23 million EVs in the United States.
“There is a reason I chose South Korea as our first economic development trip,” Mr. Kemp said. “To visit with great companies like this one.”
During that 2019 mission, Mr. Kemp met with Hyundai Motor Group Executive Chair Euisun Chung, who said in a video message to attendees Friday that its so-called “smart factory” will incorporate artificial intelligence, connected manufacturing and renewable energy sources that will accelerate the company’s moves toward carbon neutrality.
In addition to creating a “wide range of existing and innovative EVs for our American customers,” Mr. Chung said the investment will contribute to a stable supply chain for U.S. EV manufacturing.
“The U.S. has always held an important place in the group’s global strategy, and we are excited to partner with the state of Georgia to achieve our shared goal of electrified mobility and sustainability in the U.S.,” Mr. Chung said in a statement.
Hyundai Motor did not specify which models would be produced at the plant, and news reports on this topic were all over the map, asserting that the factory would make various combinations of the three brands under the Hyundai Motor Group umbrella. Mr. Wilson said it was “still a moving target for them.”
Reached via email, a company spokesperson said it was too early to reveal the models. Construction on the plant is set to begin in January. Production will start in the first half of 2025, with the plant boasting a capacity of 300,000 vehicles annually. A separate battery plant will come later through a “strategic partnership,” Hyundai said without providing details. SK Group, which makes batteries in Commerce, Ga., has supplied some Hyundai and Kia electric models around the world, but the group also works with LG Energy Solution in certain markets.
Even before Friday, Hyundai had already doubled down on the South, committing $300 million in April to upgrade its Montgomery, Ala., plant to make its hybrid Hyundai Santa Fe SUVs as well as an electrified version of the Genesis G70 luxury SUV, the first of which will roll off the lines in December. The Genesis G60 crossover will be introduced to the U.S. this year. After 2025, Genesis plans to make only electric models.
“When we decided to build our first fully dedicated plant outside of Korea, we chose the United States because America embraces changes and drives innovations,” Jaehoon “Jay” Chang, CEO of Hyundai Motor, said at the unveiling event.
Since 1985, Hyundai Group has invested more than $13.5 billion in the United States and created more than 100,000 American jobs, Mr. Chang said, noting that the Georgia plant “represents the future of our business,” which grew 20 percent in the U.S. last year despite the global chip shortage that limited new vehicle supplies.
Mr. Wilson said Georgia was well-positioned to help Hyundai grow further, given the group’s familiarity with the state’s assets over more than a decade of partnership. Kia is one of the Georgia Ports Authority’s largest customers, bringing containerized parts through the Garden City Terminal in Savannah. Both Kia and Hyundai ship in and out of the automotive port in Brunswick, Ga. Atlanta also plays a role, thanks to its large Korean diaspora and strong nonstop air links to Seoul.
“They are very comfortable with the things Georgia has to offer,” Mr. Wilson told Global Atlanta.
Mr. Chang validated that idea in his speech.
“We are a South Korean company, and we are proud of our roots, but we are also a global enterprise with global talent that is exceeding our customer expectations and meeting them where they are, on their terms,” Mr. Chang said, adding that the Hyundai group is a “family” at its core. “Today, I’m proud to call the people of Georgia family and to call Bryan County home.”
The event ended with a video showcasing Hyundai’s capabilities in the robotics realm, and with Hyundai Motor America President and COO José Muñoz toasting the company’s success. In brief remarks, Mr. Muñoz welcomed dealer advisory board members from Hyundai and Genesis — but not Kia.
Whichever models get the Georgia-made stamp, Mr. Wilson — who drives a Kia Telluride SUV assembled in West Point — believes in the brands. Not long ago, got behind the wheel of a Kia EV6, the all-electric crossover introduced in the U.S.
“That EV6 was as amazing a ride as any car that I’ve been in in a long time,” Mr. Wilson said, taking note of the consumer-friendly technology Kia always packs in its interiors. “Not only is the ride very advanced and comfortable, but it’s about how you feel on the inside.”
On a recent economic-development mission to London, the car that picked Mr. Wilson up from the airport was a Hyundai Ioniq 5 electric crossover. Maybe it was fate — like the kind that helped Georgia win Hyundai years after being passed over by foreign automakers like Volvo, which ended up in South Carolina after heavily considering a megasite in Georgia.
Mr. Wilson praised the four-county joint development authority that prepared the Bryan County site for Hyundai’s arrival, just a year after they banded together.
“I’ve had this conversation with our team, that while every opportunity that you lose seems pretty bad at that time, we have landed the perfect company, and I think we all feel extremely grateful that it has worked out the way it has,” Mr. Wilson said.
After presiding over the whole event, Savannah Economic Development Authority President Trip Tollison may have encapsulated that feeling best in his parting remarks: “God bless Hyundai.”