Georgia is viewing Hyundai Motor Group’s recent announcement of a $7.4 billion investment on its electric-vehicle transition in the U.S. with great anticipation as the state’s ambitions rise in the fast-growing sector.
Already a hub for traditional automotive manufacturing, Georgia leaders see the state as primed to take advantage of the shift away from gas-powered vehicles, particularly when it comes to the major Korean-owned players.
Kia’s only factory in the U.S. is located in West Point, Ga., and it remains the state’s only nameplate despite having hundreds of suppliers mostly from Europe and Asia that have invested billions of dollars to supply factories around the region.
Hyundai, Kia’s parent company, has its U.S. factory across the border in Montgomery, Ala. In between, a corridor of Korean auto suppliers have taken root, investing almost continuously for the past decade to take advantage of their growing U.S. market share.
Now, the companies see an inflection point in the market and announced May 13 — a week before Korean President Moon Jae-in was set to meet President Joe Biden in Washington — a heavy investment in a clean-energy future.
Hyundai said both brands would begin producing battery-powered electric cars in the U.S., with Hyundai offering American-made EVs to consumers in 2022.
The company did not say where those vehicles will be produced, instead noting in a statement that it would “monitor the market conditions and U.S. government EV policy to finalize its plan to enhance its U.S. production facilities and gradually expand its local EV production.”
The use of the word “enhance” sounds promising, but it also implies that Kia is holding out the option of building a new greenfield plant somewhere else rather than pouring more money into Georgia.
Pat Wilson, commissioner of the Georgia Department of Economic Development, hopes the strides made in what he calls the “e-mobility ecosystem” will persuade the company that the state ranked No. 1 for business still makes the most sense.
“As Hyundai and Kia focus on electrifying their fleets, we are ready to support them. Kia Motors Manufacturing Georgia has been an outstanding partner – we are excited about them being part of our story, and we look forward to seeing the company continue to invest in the U.S.,” Mr. Wilson told Global Atlanta. After the initial announcement, he posted a message on LinkedIn sayin he was prepared to work with Sean Yoon, president and CEO of Kia North America.
“With our strategic investment in the United States to produce EV models, we are making huge strides to lead the EV market but also increase our contribution to the economies where we do business,” Mr. Yoon said in the news release.
At the center of Mr. Wilson’s confidence is an even bigger Korean investment than the Kia plant: SK Battery, which is putting $2.6 billion in the first two phases of its EV battery plant in Commerce, creating 2,600 jobs. If all goes well, the company could basically double that impact in the next five years. Mr. Wilson also pointed to suppliers and investments like Heliox, a Dutch provider of charring stations for fleets, as evidence of the state’s strengths in the next phase of the auto industry.
Though its first known clients in the U.S. are Ford and Volkswagen, SK Innovation has deepened partnerships back home and globally with Hyundai and Kia, even down to the factory floor. In April, the companies announced they would work together to develop batteries for hybrid vehicles. SK already supplies batteries for Hyundai’s electric-vehicle platform, E-GMP, announced last December, as well as for the Kia EV6 and the G80 sedan from Hyundai’s Genesis luxury brand.
Korean President Moon is slated to visit the SK Battery factory in Commerce May 22 after his meeting with President Biden.
The news of heightened investment by Hyundai-Kia comes after rumored negotiations to build an Apple EV in Georgia fell through.
In its announcement, Hyundai said it will work on a raft of other mobility issues: building the hydrogen fuel-cell ecosystem in the U.S., launching urban air mobility subsidiary in Washington, growing its Boston Dynamics robotics platform (in which it invested $1.1 billion for 80 percent ownership) and launching Motional, a mobility subsidiary in partnership with Aptiv working on an autonomous taxi service.