Hyundai accelerates EV buildout in U.S. South despite political threats

Credit: Justin Taylor for The Current GA

Credit: Justin Taylor for The Current GA

The commitment comes as newly elected President Donald Trump threatens to repeal a popular EV buyer tax credit and impose a 25% tariff on vehicles and certain car parts made overseas as early as next week. Hyundai and Kia EVs made in Georgia would qualify for the $7,500 tax credit once a pair of Georgia battery factories come online later this year.

As for parts, the automaker imports an undisclosed amount — the industry average is 60% — but is onshoring many materials. Of the 20 Metaplant suppliers to open manufacturing facilities in the state in recent years, 19 are based in Asia. Hyundai is also building a steel mill in Louisiana to supply its U.S. factories.

“We will stay the course, and we will continue to produce more,” said Hyundai CEO José Muñoz in an interview with media Wednesday at the EV manufacturing facility 20 minutes west of Savannah. “What I cannot change is demand.”

EV sales in the U.S. continue to grow but at a more cautious pace than was forecast when Hyundai announced the building of the Georgia factory in 2022. Year-over-year sales were higher by 7.3% in 2024 after gaining 49% in the previous year, according to a Cox Automotive analysis. Cox Automotive is a subsidiary of the same company that owns The Atlanta Journal-Constitution.

The slowing is why Hyundai is seeking government permits to build hybrids as well as all-electric cars at the factory near Savannah. Hybrids are propelled by electric batteries that are charged while in motion by a traditional gasoline-powered motor, resulting in greater fuel efficiency.

Muñoz projected that one-third of the Metaplant’s production — more than 166,000 units based on 500,000 cars a year — will be hybrids.

Credit: AP

Credit: AP

Consumer preferences — not politics or government politics — dictate Hyundai’s business decisions, Muñoz said. The automaker decided to build an EV factory in the U.S. during Trump’s first term, before he lost the 2020 election, and the facility was under construction prior to passage of the law that established the EV tax incentive in 2022. That legislation, the Inflation Reduction Act, was a bipartisan effort but was enacted under a Democratic president, Joe Biden.

Planning for the investments announced this week — the Louisiana steel mill, Metaplant expansion and other U.S.-based projects — began during Biden’s term, before last November’s election.

Hyundai has never invested in the U.S. based on incentives, Muñoz said, instead focusing on the market opportunity. Hyundai is the world’s fifth-largest automaker, with one-third of those sales to American buyers. He said the U.S. is “the market we believed was the one we needed the most,” a sentiment shared by Hyundai’s top executive, Euisun Chung.

“I have never been more optimistic about building the future of mobility in America,” Chung said, referencing Hyundai’s guiding business principle.

Credit: AP

Credit: AP

Muñoz even managed to put a positive spin on the possibility that the EV tax credit could be abolished by Trump and Republicans in Congress. He noted that because Hyundai EVs are not yet eligible for the rebate because they are built with too many foreign parts, the incentive has increased the competitive advantage of rival EV makers in the U.S., such as Tesla and General Motors.

He wants a level playing field where Hyundai can win customers based on the quality of their automobiles.

“If the incentives were to stay, OK, that is very good because it’s going to be better for the consumer,” Muñoz said. “But if not, as long as we all have the same conditions, it is going to be better for us.”