Hyundai is opening a $5.5 billion plant in Georgia this month

WASHINGTON, Oct 14 (Reuters) – South Korea’s Hyundai Motor Co (005380.KS) said on Friday it will open a $5.5 billion electric vehicle and battery plant in the United States this month .

Hyundai plans to start commercial production in the first half of 2025 with an annual capacity of 300,000 units. The Oct. 25 grand opening of the Hyundai Group’s “meta-factory” in Savannah, Georgia, is part of the Hyundai Group’s “commitment of $10 billion by 2025 to drive future mobility in the United States , including the production of electric vehicles,” the company said.

The inauguration comes amid anger in Korea and the European Union over US tax policy on electric vehicles.

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The Cut Inflation Act, signed by Biden in August, requires electric vehicles assembled in North America to be eligible for tax credits in the United States, but excluded Hyundai and its subsidiary Kia Corp (000270. KS) subsidies for electric vehicles, because they don’t make the vehicles there yet, as well as the big European automakers.

The law made about 70% of electric vehicles immediately ineligible for tax credits of up to $7,500 per vehicle.

Biden has expressed willingness to continue discussions with South Korea on recent US legislation that denies subsidies to most foreign electric vehicle (EV) makers, South Korea said earlier this month.

Biden has also repeatedly praised investments by major foreign automakers to build electric vehicles and battery factories in the United States, including an announcement Tuesday by Honda Motor (7267.T) and LG Energy (373220.KS). that they would locate $4.4 billion. battery factory in Ohio.

Biden gave the assurance in a letter to South Korean President Yoon Suk-yeol, who had asked the US president for help last month to allay Seoul’s fears that new US rules would hurt South Korean automakers. , reported Reuters.

Following the August law, only about 20 electric vehicles are eligible for subsidies under the new rules, including models from Ford Motor Co and BMW (BMWG.DE).

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Reporting by David Shepardson Editing by Shri Navaratnam

Our standards: The Thomson Reuters Trust Principles.

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