Gov. Brian Kemp and Hyundai Motor officials are expected to make the U.S. announcement in the Savannah area within hours of an event between Biden and South Korean leaders and company executives.
Hyundai Motor has been in advanced negotiations for a 2,200-acre site along I-16 in Bryan County. The auto group is expected to build plug-in vehicles for its Hyundai and Kia brands, as well as batteries to power them, two people have told the AJC.
The project, which one official said would amount to a $7.5 billion investment, would be the largest economic development deal by number of jobs ever recruited by Georgia in a high-tech sector that the state covets. Other details of the project, such as state government incentives, were not immediately known.
In a statement Thursday, Hyundai Motor Group did not confirm the timing of an announcement or Georgia as the factory location. It said the company “is committed to accelerating electrification in the U.S.,” and that an announcement will come soon.
The AJC reported earlier this week that a formal announcement was expected before the May 24 Republican primary for governor. Kemp faces a challenge from several candidates, most notably former U.S. Sen. David Perdue.
Biden has pushed to electrify the federal vehicle fleet and encourage more EV production and green jobs in the U.S. He is expected to travel to Asia for bilateral meetings with the leaders of South Korea and Japan, respectively, from May 20-24 on missions focused on economic cooperation and security.
A new Hyundai Motor plant would follow the recruitment of electric vehicle maker Rivian, which announced in December it would build a $5 billion factory an hour east of Atlanta to open in 2024. SK Innovation, meanwhile, is building a $2.6 billion EV battery complex in Commerce.
Hyundai Motor has deep ties to Georgia. Its Kia subsidiary announced its first U.S. plant in West Point in 2006.
States covet auto plants because of the jobs and investment they bring and potential for spinoff jobs from suppliers. Kia already has a web of suppliers in Georgia that support its West Point factory, where it builds gas-powered Sorento and Telluride SUVs and K5 sedans.
The incentive package that state officials would offer to land the Hyundai Motor expansion is not immediately clear. But it could rival the record-breaking $1.5 billion bounty of perks negotiated for Rivian, which includes free land, grants, tax credits, a workforce training center and infrastructure improvements.
The Rivian inducements drew criticism from watchdogs and local residents who criticized the package as too generous, though economic development officials framed it as necessary to land a transformative project.
Conventional automakers like Hyundai, Kia, Toyota, Ford and General Motors are wrestling with EV giant Tesla and a slew of well-financed upstarts such as Rivian and Lucid to perfect plug-in vehicles. Analysts expect consumers to increasingly bypass vehicles powered by internal combustion engines for battery-powered ones.
Last year, Hyundai Motor, which includes the Hyundai and Kia brands, announced plans to invest $7.4 billion in the U.S. by 2025 to expand manufacturing capabilities and boost production of electric vehicles and other mobility technologies.
Hyundai operates an assembly plant near Montgomery, Alabama, where Automotive News recently reported the company will build an electric crossover for its luxury Genesis brand.
Though electric vehicles make up only about 3% of all U.S. auto sales, sales are expected to increase exponentially amid tightening emissions and fuel economy standards and as the cost of EVs becomes competitive with gas-powered models.
But supply chain issues, sourcing battery components and development of charging infrastructure remain challenges for the sector.
Georgia’s first Kia plant opened in 2009 when Georgia was still mired in the Great Recession and as West Point was reeling from losses to the textile industry.
Since then, the West Point factory has grown to employ more than 2,700 and the company has drawn dozens of suppliers to the state, which collectively employ thousands more.
The Kia factory has been a roaring success and runs 24 hours a day with three shifts, producing 340,000 vehicles a year, according to the company.
Vehicles from Hyundai Motor Group, which includes Kia, Hyundai and Genesis, made up nearly 10% of all automobiles sold in the U.S. last year, ranking fifth among major manufacturers, according to Cox Automotive, which like the AJC, is a division of Cox Enterprises.
The more than 2,200-acre South Georgia site under negotiations for the new plant, near the unincorporated town of Ellabell, is a sprawling tract the state once pitched to several automakers, including Rivian, Volvo and Jaguar Land Rover.
The state of Georgia paid $61 million to purchase the undeveloped property last July. The site enjoys highway and rail connections to the state’s ports in Savannah and Brunswick.
A note of disclosure
Cox Enterprises, owner of The Atlanta Journal-Constitution, owns about a 4% stake in Rivian and supplies services to the company. Sandy Schwartz, a Cox executive who oversees the AJC, is on Rivian’s board of directors and holds stock personally. He does not take part in the AJC’s coverage of Rivian.