The Hyundai IONIQ 5 has been among the best-selling electric vehicles (EVs) in the U.S. and abroad. After constructing a $7.6 billion factory and battery plant in Georgia, the automaker will manufacture the IONIQ lineup on American soil. This move will allow the car to qualify for the $7,500 clean vehicle tax credit. It joins Kia in building EVs in Georgia.
Hyundai EVs have been selling well in the U.S., with nearly 3,400 IONIQ 5s sold in March. More than 6,800 were sold in the first three months of 2024. Even the IONIQ 6 doesn’t sell as well as the IONIQ 5, with the 5 sales nearly doubling the 6’s. However, it’s imported from Korea, disqualifying it from the tax credits.
The Hyundai announcement followed the news of Kia producing its first EV in Georgia. The EV9 came out in March 2023, with deliveries starting in Korea in June 2023.
More than 48,000 EV9s have been sold globally. With the EV9 being assembled in the Peach State, it, too will qualify for tax credits. Georgia Gov. Brian Kemp was in attendance to make the announcement.
Photo Courtesy Kia
The Hyundai Metaplant will begin producing cars in October. Jose Munoz, global COO, said the battery plant side will open in 2025. For now, batteries will be sourced from a factory in Hungary.
Most IONIQ 5 models fall below the $55,000 MSRP cutoff, allowing customers to take full advantage of the $7,500 credit — the standard IONIQ 5 drops below the $40,000 mark with the discount. There’s no update on where Hyundai will get its critical minerals for batteries. However, it could take advantage of the domestic lithium sourcing plan the federal government is rolling out to cut back on foreign reliance.
Kia’s EV9 will just barely qualify for the tax credit. The base model starts at $54,900, and $7,500 in discounts lowers it to $47,400. If all models potentially qualify, Kia could slowly catch up with its parent company.
“Establishing a domestic supply chain for lithium-based batteries requires a national commitment to both solving breakthrough scientific challenges for new materials and developing a manufacturing base that meets the demands of the growing electric vehicle (EV) and stationary grid storage markets,” Jennifer Granholm, secretary of energy, said in the U.S. Department of Energy’s lithium sourcing blueprint.
The Hyundai plant is opening in Savanna, Georgia. Kia is also opening a plant in West Point, Georgia. Both vehicles qualifying for the tax credits can spur more EV adoption, pushing federal climate action goals forward.
Graphic Courtesy Hyundai
The factory news was announced after quarterly reports showed a strong start to 2024. The company is competing quite well with Tesla.
Nearly 4,500 IONIQ 5 units have been moved through the first five months of 2024. Business Korea reported that Hyundai and Kia accounted for 11.2% of U.S. EV sales through May.
That closes the gap on Tesla to 40.5% on the market share, down from 52.9%.
Some American consumers have praised the IONIQ line. One commenter on Electrek’s article about IONIQ 5’s sales said the price point and battery range are major reasons they bought one and why the public loves them.
They also said the lease deals were incredible, and this person’s local dealership “threw money at us; it was kind of wild.” The dealership took $10,000 off the MSRP. Hyundai had also introduced a manufacturer’s discount for customers back in January, though it was a limited-time offer.
Any EV on the road is good when it comes to reducing carbon emissions from transportation and reaching government goals. However, from a business standpoint, Hyundai’s expansion in the U.S. can be good for healthy competition. Tesla may still be the clear No. 1, but the battle for No. 2 is on as American, European, and Asian brands jockey for position.
