Hyundai has so much driving on a patch of rural Georgia. In October, the South Korean auto big opened a brand new electric-vehicle manufacturing facility west of Savannah on the eye-watering value of $7.6 billion. It’s the biggest economic-development venture within the state’s historical past (one which prompted the Georgia statehouse to cross a decision recognizing “Hyundai Day”). For now, employees on the so-called Metaplant are constructing the corporate’s in style electrical SUV, the Hyundai Ioniq 5, and shortly extra EVs might be constructed there, too. And to energy these automobiles, Hyundai is about to open a battery plant on the website, and is spending billions to open one other one elsewhere in Georgia.
Hyundai’s plan will permit the Ioniq 5—and different future electrical vehicles already within the works—to qualify for tax credit applied by the Inflation Discount Act. American-made EVs are eligible for rebates that may knock 1000’s of {dollars} off their worth, making them much more interesting to customers. However Hyundai’s practically $13 billion funding could quickly hit a snag. In his second time period, President-elect Donald Trump has mentioned he’ll make these tax credit historical past. If he follows via on that promise, EV gross sales will certainly sluggish, and People will purchase extra gasoline guzzlers that may produce emissions for the decade-plus they’ll be on the street. The issue is worse than it would look: The auto business is investing greater than $300 billion to satisfy the Biden administration’s EV targets. Most automakers are hemorrhaging cash on EVs, and revoking these incentives could give them an excuse to roll again their plans to introduce electrical vehicles, which might give customers extra clean-driving choices.
Even when Trump cracks down on EVs, Hyundai is likely to be uniquely well-equipped to maintain People enthusiastic about going electrical. The Hyundai Motor Group’s three manufacturers—Hyundai, Kia, and Genesis—have emerged as a distant second to Tesla in EV gross sales this yr. However their electrical vehicles include worth tags, battery ranges, and high-tech options which are onerous to beat. Hyundai’s Ioniq 6 sedan retails for about the identical as a Tesla Mannequin 3, however can recharge extra shortly. The corporate’s vehicles additionally permit People to go electrical in methods they may not beforehand: Earlier than the Kia EV9, households searching for a very spacious three-row SUV had no good electrical choices. “Because the EV scene is about to probably get shaken as much as its core,” Robby DeGraff, an analyst on the consulting agency AutoPacific, advised me, Hyundai’s eclectic lineup “is one thing Tesla lacks.” Despite Elon Musk’s bromance with Trump, a very powerful EV firm of his second time period could transform Hyundai.
It might sound bizarre that Musk has cheered on Trump’s need to claw again EV incentives, however Tesla is uncommon in that it’s profitably constructing EVs at scale. It may possibly climate the lack of tax credit higher than others. If the EV tax credit evaporated tomorrow, start-ups resembling Rivian and Lucid Motors would face main complications. They’re nonetheless within the early, money-losing stage that Tesla was in for nearly twenty years: They lack the economies of scale to promote EVs at excessive volumes and low cost costs. Their EVs are nonetheless on the costly aspect, so that they’ll want all the assistance they will get to cross the “valley of dying.” That’s even an issue for large legacy firms. Ford is already backtracking as electrical gross sales fail to satisfy expectations and prices preserve mounting; it’d be onerous to justify extra EVs with out authorities assist to win over new consumers.
A scant few firms’ electrical efforts could possibly be wonderful with out the incentives. In addition to Tesla, there’s Common Motors. It has spent the yr implementing a shock turnaround of its electrical operations after a disastrous 2023, and it’s additionally making an increasing number of inexpensive EVs—whereas approaching profitability as effectively.
Then there’s Hyundai. In addition to Tesla, it’s maybe the one main automotive firm in america being profitable off EVs, and it’s bringing out new electrical fashions at a frantic clip. Hyundai’s EV push has been a uncommon vivid spot for an business buried below mounting losses and strategic blunders. In 2024, Tesla’s gross sales have slipped, maybe partially as a result of the corporate’s lineup of EVs is beginning to really feel a bit stale: In addition to the Cybertruck, which begins at practically $80,000, Tesla hasn’t launched a wholly new mannequin since 2020. Tesla has promised time and again that it’s going to launch an electrical automotive for lower than $30,000, however it has did not ship because it now pivots to robotaxis.
By comparability, Hyundai’s EVs are beginning to outclass Tesla’s. Take the Kia EV3. The high-range compact automotive, which is already on sale in Europe and South Korea, will possible begin at about $35,000 in the case of the U.S. in 2026. On the current Los Angeles Auto Present, all three Hyundai manufacturers confirmed off new fashions, which is able to every be capable of entry Tesla’s beforehand unique Supercharger community straight from the manufacturing facility. In doing so, Hyundai’s manufacturers will promote as many EV fashions with Tesla’s plug sort as Tesla does. On the opposite finish of the spectrum, Hyundai has an EV that simulates the engine sounds and kit shifts present in a high-performance gasoline automotive, with not one of the emissions. In the meantime, they do different issues Teslas are barely beginning to do, resembling energy complete properties in an emergency. Tax credit or not, “we usually imagine that is going to be what the purchasers will demand,” José Muñoz, Hyundai’s world CEO, advised me.
Hyundai has come a great distance from the early aughts, when it was a punch line in hip-hop music. To the diploma that Hyundai vehicles had been engaging to American consumers, it was as a result of they had been usually cheaper than a comparable Honda or Toyota (however often not pretty much as good). Hyundai’s glow-up isn’t nearly EVs. It’s about bringing Tesla ranges of know-how to the “conventional” automotive business. Lately, Hyundai has poached a few of the business’s high design and engineering expertise to develop into a pacesetter in each areas; acquired Boston Dynamics to get into the robotics house; inked a deal to offer Hyundai EVs for Google’s driverless Waymo taxi service; and established itself as the primary model to promote new vehicles on Amazon.
The irony of Hyundai’s transformation is that the South Korean authorities aided in it with the type of regulatory help that Trump could now reduce off for america. That included incentives to assist the nation construct out its personal battery business, leaning on Korean tech giants resembling LG, SK On, and Samsung to wean itself off China, which dominates the battery sector. And with roughly 8,000 jobs simply on the Georgia Metaplant, the U.S. appears to be benefiting from Hyundai’s renaissance as a lot as its house nation. Maybe the financial rationale for preserving the EV incentives could save them. Georgia Governor Brian Kemp, a Republican, has been an enormous cheerleader for Hyundai’s investments in his state; many of the funding below the Inflation Discount Act has gone to Republican districts.
If Trump does nix the EV tax credit, Hyundai ought to nonetheless be in an excellent place. Its choice to make EVs and their batteries right here ought to preserve their prices down, DeGraff advised me. That’s very true as Trump threatens tariffs, which may hit vehicles made in Mexico and South Korea. However with out EV tax credit, Hyundai can solely accomplish that a lot to maintain promoting electrical vehicles. Hyundai has particularly benefited from a loophole that makes it less expensive to lease EVs, and with out these reductions, consumers could resolve that the recognized complications round charging and vary anxiousness aren’t well worth the bother. DeGraff mentioned that his agency, AutoPacific, has discovered that three-quarters of potential consumers say tax credit are an vital consideration for EV shopping for. Finally, Hyundai’s large EV investments in America will take a look at this query: Are People nonetheless prepared to go electrical in the event that they aren’t closely sponsored to take action?
Ultimately, they most likely will in the event that they’re getting an excellent deal—and that’s the place Hyundai is poised to do effectively. “Affordability will proceed to be the primary make-it-or-break-it [factor] for EV buyers, particularly if we see a wave of recent tariffs utilized to actually the whole lot outdoors of the automotive house that may consequently squeeze People’ wallets even tighter,” DeGraff mentioned. Trump nearly definitely is dangerous information for EV gross sales, however he alone is not going to dictate what vehicles People purchase. Throughout his coming presidency, automotive firms could have much more of an onus to make EVs that People will need to purchase no matter whether or not they care concerning the setting. The promise of Hyundai is that it has quietly discovered a street map on learn how to get there: No matter tariffs or tax credit, it’s onerous to withstand a candy deal on an excellent automotive.