SEOUL — Elon Musk’s Tesla faces strong new competition in the cutthroat American electric vehicle market with the opening of a Hyundai Motor “metaplant” in Georgia that’s gearing to eventually churn out half a million vehicles a year under its three corporate brands.
With the Georgia governor, Brian Kemp, at his side, the chairman of Hyundai Motor, Chung Eui-sun, opened Hyundai’s “dedicated mass-production, electrified vehicle plant” near Savannah on the day that President Trump announced 25 percent tariffs on imported motor vehicles starting April 2. Mr. Chung and his aides took pains to deny the widespread impression the new plant was a tariff dodge.
Far from “preparing for tariffs,” Mr. Chung told reporters, he sees the plant “as part of a broader effort to manufacture EVs with low-carbon steel in the U.S.” In three years, Hyundai Motor will be getting most of its steel in the form of high-strength sheets and planes plus some parts from a new plant it’s building in Louisiana — all part of at least $20 billion that the Hyundai Motor group is investing in America.
As for tariffs, Mr. Chung said, right now they’re “a matter between governments.” Not until April 2, he noted, would companies start negotiating on them. Koreans will argue that vehicles made in Korea are exempt from tariffs under the Korea-U.S. Free Trade Agreement.
Looking to make 300,000 cars a year in the newly opened Savannah plant before hitting full stride at half a million annually, Hyundai made 705,000 vehicles last year at its two other American plants, at Montgomery, Alabama, and, in the name of Hyundai’s Kia subsidiary, at West Point, Georgia. Despite tariffs, the company should go on exporting Korea-made models to America at the same torrid pace of about a million a year.
Tesla’s top two models are so far ahead of their EV competitors, though, that none of the also-rans would seem to have a chance of catching up. Just look at the numbers for last year: Tesla Model Y led the pack with 372,613 vehicles sold in America, followed by Tesla Model 3 with 189,903 and, in fifth place, the Tesla Cybertruck, 38,965. Those numbers gave Tesla 46.2 percent of the American electric vehicle market in 2024. Hyundai, selling 44,400 IONIQ5s, ranked fourth with sales of 44,400, or 3.4 percent of the market, behind Ford Mustang Mach-E’s sales of 51,745 vehicles, 4 percent.
If Hyundai would not seem to pose much of a threat to Tesla, the first Hyundai IONIQ5 did not roll off the line in the Savannah plant until last October, and it won’t be until next year that the plant produces vehicles with the Kia nameplate. In the numbers game, 500,000 vehicles a year is the ultimate goal.
Hyundai Motor should begin to challengeTesla when the Savannah plant produces not only Hyundai cars but also cars bearing the name of Kia, which are Hyundai equivalents, as well as top-of-the-line Genesis luxury cars, which also don’t carry the Hyundai name.
Hyundai aspires to advance on the relatively new technology for electric vehicles by investing in research and development within the vast confines of the “metaplant” — a word that its website says was chosen to “transform the definition of what an automotive plant is and will transform its Meta Pros Perception of what working in a manufacturing facility can be.” In that spirit, Hyundai Motor will also build a separate R&D center in California and an “AI-focused mobility lab.” All told, Hyundai Motor predicts it will eventually take on about 14,000 new hires.
Hyundai Motor’s dreams for the future contrast with the nightmare of new American tariffs on motor vehicle imports from smaller manufacturers. Provoking howls of anguish from exporters worldwide, the tariffs are particularly devastating for Hyundai Motors’s only real rival in Korea, GM Korea.
Now producing Cadillacs, Chevrolets, and GMC trucks, GM Korea exported 418,782 of them to America last year while selling only 24,824 inside Korea. The company seven years ago closed one of its three Korean plants but managed to keep the other two going with an infusion of Korean government funding.
The tariffs may tip the balance and bring about the demise of GM Korea. “GM Korea’s plant serves as a subcontracting base for manufacturing vehicles sold in the U.S.,” according to _ChosunBiz_, an offshoot of the Korean newspaper _Chosun Ilbo_. “If the Trump administration imposes a 25 percent tariff, there will no longer be a reason to operate the plant in Korea.”