Hyundai's $7.6B Georgia Plant Starts Electric SUV Production Amid Safety Concerns

Hyundai said it started production of electric small utility vehicles (SUVs) in its $7.6 billion plant in Georgia, less than two years after the automaker broke ground at the site in late October 2022.

Hyundai Motor Group Metaplant America (HMGMA) announced that the first EV for commercial sale rolled off the assembly line, spokesperson Bianca Johnson told the Associated Press on Monday.

"After validating its production processes to ensure its vehicles meet Hyundai Motor Group's high quality standards, HMGMA has started initial production of customer vehicles ahead of schedule," Johnson said adding that a grand opening celebration at the Georgia plant is expected in the first quarter of 2025.

The sprawling Georgia facility, located west of Savannah, got a staggering $2.1 billion in tax rebates and incentives from the state and local governments as this massive project is the biggest economic development Georgia has ever seen.

Once the plant becomes fully functional, Hyundai and battery partner LG Energy Solution plans to employ 8,500 total workers at the Bryan County site, about 50 miles west of Savannah. Hyundai has said it will produce up to 300,000 EVs per year in Georgia, as well as the batteries that power them.

However, after the recent launch of the IONIQ 5, Hyundai's Georgia facility is facing safety issues following 20 injuries and 12 traumatic occurrences. The Occupational Safety and Health Administration's fines and investigations have highlighted the conflict between worker safety and economic growth.

The Ioniq 5 -- the first electric SUV 2025 variants are expected to hit U.S. showrooms by the end of 2024. Notably, in the first half of 2024, the Ioniq 5 was the second-best-selling electric car in America (apart from Tesla).

Currently, the plant's vehicle production areas have been completed and employ more than 1,000 workers. The battery-making facilities remain under construction.

To be eligible for the 2024 tax advantages, the U.S. government mandates the vehicles to be fully constructed in North America and have at least 60% of their battery components supplied from the region, per a federal mandate. The goal of this directive is to decrease dependency on foreign suppliers and increase home production.

"After validating its production processes to ensure its vehicles meet Hyundai Motor Group's high-quality standards, HMGMA has started initial production of customer vehicles ahead of schedule," Johnson said.

Hyundai benefited from the Inflation Reduction Act in the United States. Despite early reservations, President Jose Munoz says Hyundai accelerated the building of its Georgia factory because of the law's $7,500 EV tax credit.