[Photo by MK DB]
Hyundai Motor Group and LG Energy Solution Ltd. Friday announced a plan to invest a total 5.7 trillion won ($4.3 billion) to build an electric vehicle battery production plant in the U.S.
This marks Hyundai Motor Group’s second joint venture with a Korean battery maker following its partnership with SK on Co. in a response to the U.S. Inflation Reduction Act (IRA) that favors local production of EVs.
Hyundai Motor Group and LG Energy Solution held their respective board meetings on Friday and officially announced their partnership. The expected investment of 5.7 trillion won will be made over the next six years until 2028.
Both Hyundai Motor Group and LG Energy Solution will contribute 50 percent of the total investment, while the remaining half will be secured through loans. The venture will be able to produce around 30 gigawatt hours (GWh) of capacity when it gears into operations as early as at the end of 2025. That would be enough to power about 300,000 units of high-performance EVs.
Among Hyundai Motor Group units, Hyundai Motor Co. will invest 708 billion won, Kia Corp. 436.2 billion won and Hyundai Mobis Co. 286.1 billion won.
The battery alliance between Hyundai Motor Group and LG Energy Solution is their second collaboration. Previously, the two jointly invested some $1.1 billion to establish a battery cell joint venture in Karawang International Industrial City (KIIC) near Jakarta, Indonesia, with the goal of completing the factory in the first half of 2023. They plan to start mass production of battery cells in the first half of 2024.
Last month, Hyundai Motor Group announced its North American battery cell joint venture with SK on, which involves a total investment of 6.5 trillion won to build a factory in Bartow County, Georgia. The plant will be capable of producing 35 GWh batteries per year to power about 300,000 EVs.
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