Hyundai, LG to build $4.3b EV battery factory in US

Hyundai Motor Group and LG Energy Solution said on Friday that they will build a battery factory in the U.S. to supply Hyundai's electric vehicles there, as they are keen to benefit from American subsidies.

The South Korean businesses announced that they will invest 5.7 trillion won ($4.3 billion) for the joint venture in Georgia, taking a 50% stake each, reports Nikkei Asia, adding that the plant will have a production capacity of 30 gigawatt-hours, enough to supply batteries for 300,000 vehicles per year.

Starting construction in the second half of this year, the JV plans to begin battery production at the end of 2025.

"We will create a strong foundation to lead the global EV transition through establishing a new EV battery cell plant with LG Energy Solution, a leading global battery producer and longtime partner," Hyundai Motor CEO Chang Jaehoon said in a news release.

The announcement comes a month after Hyundai announced that it would build an EV battery factory with SK On, another South Korean battery maker, in Georgia by investing $5 billion together. Global auto manufacturers including GM and Honda plan to build their own battery factories in the U.S. in cooperation with battery makers, while Stellantis is negotiating with the Canadian government over subsidies for construction of its battery plant in Ontario.

The administration of President Joe Biden has created subsidies to encourage consumers to switch to EVs, on condition that the vehicles and their batteries are produced in North America.

With the JV with Hyundai, LG Energy Solution now has seven battery plants operating or being constructed in the U.S. LG Energy Solution has supplied EV batteries for Hyundai vehicles, including the Kona and Ioniq 6. Both companies started construction of their Indonesia battery cell JV in 2021.