The Governor of New Nuevo León, Mexico, announced a new (potential billion-dollar) investment from Kia to expand its plant in the region and produce two EVs together with Hyundai. The move comes as the two automakers look to ensure EV models qualify for the IRA tax credit.
After becoming the third largest automaker globally last year, The Hyundai Motor Group, including Kia and Genesis, looks to keep the ball rolling in the new EV era.
Both Hyundai and Kia brands got off to a hot start by releasing the IONIQ 5 and EV6 EV models, based on the auto group’s dedicated E-GMP electric vehicle platform.
With several new releases from all brands under the Hyundai umbrella, including the IONIQ 6, Kona Electic, Kia EV9, and Genesis GV70, the automaker plans to become a top three global EV producer by 2030.
However, after the Inflation Reduction Act’s (IRA) standards set in for new EVs to qualify for the $7,500 tax credit, many Kia and Hyundai models have become ineligible.
Despite breaking ground on its first dedicated EV plant in the US in October, that facility isn’t expected to become operational until 2025.
With North America being Hyundai’s single largest market, representing over a fifth of sales last year, Hyundai is looking for ways to ensure its EVs will qualify for the tax credit to secure its market.
Kia, Hyundai to build EVs in Mexico for IRA tax credit
The Governor of New Nuevo León, Mexico, Samuel Garcia, revealed Kia’s plans on his Twitter this week, initially saying Kia once again bets on Nuevo Leon with a “billion dollar investment to expand its plant and produce two Kia car models” later editing out the billion.
Another retweet from Garcia read, “#Kia announces billion dollar investment to install another plant in #NuevoLeon where it will produce two new electric models in conjunction with Hyundai.”
A translation of Garcia’s own tweet reads, “More good news! Nuevo León consolidates as the ELECTROMOBILITY HUB: KIA once again bets on Nuevo León with an investment to expand its plant and produce two KIA car models.”
From Garcia’s post, it could just be an expansion on the automaker’s existing 400,000-vehicle capacity plant in the area, which began operations in 2016.
According to the images Garcia posted on his account, one of the two electric vehicles could be the new flagship EV9. However, Kia has already said the electric SUV will be built in West Point, Georgia, starting next year as the brand’s first EV assembled in the US.
With the new planned investment, Garcia says, “We will be the state that produces the most electric car models: the Tesla model, the KIA model, and the Navistar electric truck.”