Hyundai Accelerates US EV Plant Launch for $7,500 Tax Credit Eligibility

The first Hyundai plant dedicated to EVs and batteries in the United States will open in October. According to Hyundai Motor America CEO Jose Munoz, the brand is "pulling ahead" to qualify for the $7,500 EV tax credit.

Hyundai Will Open Its First EV Plant in the US in 2024

Hyundai started building an enormous $7.6 billion EV mega plant in Georgia in October 2022. A year later, the business reported that 99.9% of the foundation work had been completed as it accelerated construction.

According to Oscar Kwon, CEO of Hyundai Motor Group Metaplant America (HMGMA), the site "is advancing every day."

Although Hyundai had intended to start construction in early 2023, the business moved forward when the Inflation Reduction Act was passed. With a $7,500 tax credit on the line, Hyundai has accelerated the timeframe as much as feasible.

Munoz told Automotive News that Hyundai is "pulling ahead because everybody knows how important it is" that they do not qualify for the tax credit.

Despite this, Hyundai Motor (including Kia and Genesis) surpassed Ford and General Motors to become the second largest EV seller in the United States, trailing only Tesla. A significant portion of the brand's success is due to a loophole that allows its EVs to qualify for the $7,500 tax credit through leasing.

According to BloombergNEF data, Hyundai and Kia sold approximately 8% of all passenger EVs (117,000 units) in the United States last year.

Betting on Electric Vehicles

The carmaker is making progress with dedicated EVs such as the IONIQ 5, IONIQ 6, and Kia's new three-row EV9.

Munoz stated that EVs manufactured at the new plant will qualify for the tax incentive. "There are a lot of moving pieces, but I am confident very shortly after we start, we will be compliant," he said.

The first Hyundai electric vehicle plant is planned to open in October 2024, three months ahead of schedule. Meanwhile, battery production with LG Energy is set to begin in January. Hyundai has stated that it will source batteries from other US plants to fill the gap.

Once operational, Hyundai's Metaplant will be capable of producing 300,000 EVs per year. Hyundai claims that it can be expanded to 500,000 if necessary.

The factory will build six electric models from Hyundai, Kia, and Genesis, including Hyundai's first three-row electric SUV, the IONIQ 7. The IONIQ 7 will likely be unveiled this year, and manufacturing will begin in 2025.

Despite rivals Ford and GM delaying EV plans and reducing output, Hyundai is putting its foot on the throttle.

Although a few retailers are still not selling IONIQ EVs, Munoz stated, "We are asking them to hurry up because we will continue to bet on electric vehicles."

Munoz stated that Hyundai will provide compatibility with Tesla's NACS by the fourth quarter to alleviate dealer concerns. Older models will be given an adaptor so that they can still connect to the network.

The 2024 Hyundai IONIQ 6 costs more than $9,000 less than the new Tesla Model 3 because of incentives such as a $7,500 special cash offer. Meanwhile, the 2024 Hyundai Kona Electric, priced at $32,675, is one of the most affordable electric vehicles in the United States.

Photo: Hyundai Motor Group/Unsplash