November 21, 2024

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Hyundai Motor officials celebrate the rollout of the first Ioniq 5 electric vehicle at Hyundai Motor Group Metaplant American in Georgia in October. (Screencapture from Hyundai Motor Company Global President Jose Munoz's LinkedIn account)

Hyundai Motor has missed out on the United States tax incentives for its new $7.6-billion manufacturing plant -- Hyundai Motor Group Metaplant America -- in Bryan County, Georgia, but said the credit did not affect its investment in the plant.

According to industry sources Monday, Hyundai Motor did not make the list of companies that will receive tax incentives in the second round allocations of the Qualifying Advanced Energy Project Credit, or 48C, which is an allocated tax credit funded by President Joe Biden’s Investing in America agenda through the Inflation Reduction Act.

The Biden administration has assigned a total of $10 billion to the 48C program. Selected companies could receive up to a 30 percent tax credit for their investments on American soil.

A local report, citing unnamed industry sources, estimated that Hyundai Motor could have received up to 480 billion won ($344 million) in tax incentives.

Although Hyundai Motor was not able to receive additional tax incentives under the 48C program, the Georgia plant’s construction has been smooth sailing as the Korean automaker already began early-stage production of electric vehicles at HMGMA in October. Hyundai Motor is expected to start full operation of the new plant in the first quarter of next year.

“It’s true that (we) applied for (the 48C program) but we did not expect to receive benefits, as those tax incentives were made for parts makers not automakers,” said a Hyundai Motor official. “(The 48C program) was not in consideration when (we) invested in (HMGMA).”

The US Department of Energy announced a list of 35 projects across 20 states selected for a total of $1.93 billion in the first round allocations of the 48C program in April this year. The projects were categorized into four areas: clean energy and clean vehicle manufacturing, critical minerals and materials, grid components and modernization, and industrial decarbonization.

Mobis North America electrified Powertrain, a US subsidiary of Hyundai Motor Group’s auto parts maker Hyundai Mobis, was awarded $57.6 million in tax credits as the company was set to construct three different EV component plants that will provide parts for the production of Hyundai and Kia electric vehicles.

By Kan Hyeong-woo (hwkan@heraldcorp.com)