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Hyundai Motor Group partners with LG Energy Solution for new EV battery plant in Georgia
Hyundai Motor Group is taking further steps towards completing its $5.5 billion southeast Georgia electric vehicle production hub with the announcement of a new deal with supplier LG Energy Solution. The $4.3 billion joint venture will see the companies each holding a 50 percent stake in a new battery plant in Bryan County, capable of producing 30 gigawatt hours of batteries yearly, which can power 300,000 EVs annually. This comes after a similar deal Hyundai made with SK On Co. for a $5 billion battery plant in Bartow County, which will have an annual production capacity of 35 GWh.
Diversifying suppliers for vehicle batteries
The agreements aim to diversify Hyundai’s suppliers for a key component, creating redundancy and obtaining batteries with different form factors and chemistries. According to Conrad Layson, Senior Analyst at AutoForecast Solutions, this diversification provides important choices for OEMs in designing and marketing EVs with differing performance levels, ranges, and prices. Moreover, diversifying the battery supplier base relieves the OEMs from being dependent on issues at any one battery supplier.
Hyundai’s EV production hub in Georgia
The new battery plant in Bryan County will supply Hyundai’s new assembly plant outside Savannah, Georgia, which is set to build six new electric models, with an initial production capacity of 300,000 EVs per year. The 2,800-acre project may expand this production capacity to 500,000 based on demand. The construction of the LG joint venture plant, which will be Hyundai’s second new U.S. battery plant, will begin in 2021, with production scheduled for late 2025.
The Inflation Reduction Act opens investment floodgates
The passage of the Inflation Reduction Act has incentivized North American EV and battery manufacturing, resulting in over $11 billion in EV battery investments being announced by automakers and suppliers since the law’s passage in August. To participate in this trend, Hyundai has pledged $16 billion globally through 2030 for EVs and aims to sell 3.23 million battery-powered vehicles worldwide by then. Already, during the first quarter of 2023, Hyundai and Kia delivered approximately 119,000 EVs, down by 2.2 percent from that of the previous year, according to SNE Research, a Seoul-based research firm.
Carly Schaffner contributed to this report.