Hyundai is looking to open its upcoming Georgia factory earlier than expected following changes to the U.S. federal electric vehicle tax credit, which disqualified all of its South Korean-made EVs, according to a new report.
The automaker in May announced plans to build the $5.5 billion factory outside Savannah with the capacity to build up to 300,000 vehicles annually and a start date for manufacturing in early 2025.
Yonhap now reports that Hyundai is accelerating the timeline and will break ground this year in order to have the plant operational in the second half of 2024, sources familiar with the plan told the news agency.
Hyundai has not responded to a request for comment from FOX Business.
Hyundai has several all-electric models, including the Ioniq 5 that was named the 2022 World Car of the Year, which were eligible for a $7,500 federal tax credit before the Inflation Reduction Act was signed into law last week and instituted a requirement that qualifying vehicles be built in North America.
Along with Hyundai's vehicles, approximately 70% of the electric and plug-in hybrid models currently on sale were disqualified from the credit.
Volkswagen and Mercedes-Benz this week made an agreement with Canada to source minerals from the country, which will help bring their U.S. electric vehicle production in line with the new laws rules regarding the country of origin of battery materials. After launching with German-made cars, Volkswagen will soon begin deliveries of its Tennessee-built ID.4 electric SUV, which will allow it to qualify for the credit.
The new rules require that suppliers be based in North America or another country the U.S. has a free trade agreement with, which will exclude China.
Reuters contributed to this report