Hyundai's $8B Georgia plant faces critical test in Trump's U.S.

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Hyundai's $8B Georgia plant faces critical test in Trump's U.S.

Published: 27 Mar. 2025, 17:23 Updated: 27 Mar. 2025, 19:16

SARAH CHEA
[email protected]

Audio report: written by reporters, read by AI

Employees make the Ioniq 5 SUV at the Hyundai Motor Group Metaplant America, which officially opened on March 26 in Bryan County, Georgia. [HYUNDAI MOTOR]

[NEWS ANALYSIS]

Some critical quandaries for Hyundai Motor in the United States — the potential cancellation of EV subsidies and wastewater management issues — still loom large even after the long-anticipated opening of its $7.6 billion Metaplant in Georgia.

The Korean automaker on Wednesday officially opened the 11.76 million-square-meter (126.58 million-square-foot) Hyundai Motor Group Metaplant America (HMGMA) in Ellabell, Bryan County, which will likely allow Hyundai EV buyers to qualify for up to $7,500 in subsidies from the U.S. government, and in turn propel the automaker in the U.S. EV market currently dominated by Tesla.

But the financial support can only take place if the subsidies survive Trump’s presidency; far from certain as the president boasts about his intent to repeal the Joe Biden-backed Inflation Reduction Act (IRA) while calling for the next U.S. renaissance in manufacturing and praising fossil fuels.

Hyundai's massive plant, which includes an automobile factory and battery facility, is the key to ultimately raising the automaker's U.S. production to 1.2 million units. The auto facility's capacity currently stands at 300,000 units, with a goal of increasing to 500,000 units in the future, beating its Alabama plant at 360,000 units and Kia's Georgia plant at 340,000 units. Hyundai's Ioniq 5 and Ioniq 9 SUVs are being manufactured at the plant as of now, with Kia’s hybrid and Genesis vehicles also slated to roll off the assembly line.

“With the rich history of craftsmanship and manufacturing in this community, together with the talented workforce at HMGMA, we are building the future of mobility with America, in America," said Euisun Chung, executive chair of Hyundai Motor Group, during the plant's opening ceremony with Georiga Gov. Brian Kemp, Hyundai Motor Group Vice Chairman Chang Jae-hoon and CEO José Muñoz in attendance.

Hyundai Motor Group Executive Chair Euisun Chung, left, and Georgia Gov. Brian Kemp pose for a photo at the Hyundai Motor Group Metaplant America's opening ceremony in Bryan County, Georgia, on March 26. [HYUNDAI MOTOR]

EV subsidies at Trump’s mercy

On his first day, Trump kept his promise and declared an end to the EV mandate and signed an executive order directing all agencies to immediately suspend the disbursement of funds allocated under the IRA, such as the implementation of EV chargers and a re-examination of the tax credit system.

If the president acts on what he has pledged, demand for EVs will inevitably fall even further, which could leave Hyundai with an underused multibillion factory in Georgia.

The plant’s 300,000-unit capacity can cover Hyundai and Kia’s current U.S. sales of eco-friendly cars, which stood at 346,441 units last year.

But sales are on the downturn this year, with combined EV sales coming in at 6,962 units in February, down 10.4 percent from the same month the previous year.

Employees make the Ioniq 5 SUV at the Hyundai Motor Group Metaplant America, which officially opened on March 26 in Bryan County, Georgia. [HYUNDAI MOTOR]

“Entirely killing the subsidies is an unrealistic scenario considering the opposition of Republican lawmakers, but for sure, the subsidies will be slashed by some margin,” Jae Kim, a leading accountant for the Korea desk at Atlanta-based Aprio, a business advisory and accounting firm, told the Korea JoongAng Daily.

GlobalData, an automotive forecaster, cut its outlook for the EV market share in the United States in 2030 to 28 percent from 33 percent in the wake of Trump’s election victory.

“The potential rollback of tax credits and regulatory support has already led to delays or cancellations of projects, particularly in sectors like hydrogen, electric vehicles and wind power,” BGR Group, a Washington-based lobbying and consultation firm, wrote in a recent report.

“Some industry leaders remain optimistic that core investments will continue, but others warn that weakening incentives could undermine the momentum built over the past few years."

Hyundai Motor's Ioniq 5 SUVs are being produced at the Hyundai Motor Group Metaplant America, which officially opened on March 26 in Bryan County, Georgia. [HYUNDAI MOTOR]

'Environmentally-unfriendly' wastewater

The Savannah city government stopped treating the wastewater of the Georgia plant in September on the grounds that it violated government parameters after the city found that the water could be harmful to both the environment and humans.

The government discovered that Hyundai’s wastewater contained more than six times the acceptable limit of copper and even more than twice the allowable zinc concentration, immediately halting treatment. The city also figured out that the automaker failed to continuously observe its wastewater conductivity.

Since then, Hyundai has been transporting millions of gallons of wastewater via tanker trucks to external facilities in states like Florida and North Carolina for treatment.

Hyundai has responded that it will solve the problem as soon as Bryan County finishes its $129 million North Bryan County Water Reclamation Facility to accommodate the car plant’s industrial waste. But construction is expected to be completed no earlier than the end of 2025, while the carmaker's factory started mass production on Wednesday.

“[After the notice], Hyundai immediately stopped discharging and began a root cause analysis to determine the source,” a spokesperson for Hyundai Motor said. “We contracted a specialized company to pump wastewater into tanker trucks, and we have confirmed that all treatment facilities receiving wastewater from the site have been properly classified, permitted and authorized to treat and dispose of industrial wastewater."

BY SARAH CHEA [[email protected]]