- Kia will slow down EV9 production in the U.S. as stricter battery sourcing rules are set to be effective in 2025.
- Most EV9s sold in the U.S. at the moment are imported from Korea and use critical minerals sourced from China.
- That's set to change as the Hyundai Motor Group has two battery plants coming up in Georgia in partnership with SK On and LG Energy Solution.
The Kia EV9 is in a league of its own at the moment. It's the only offering of its kind in the $50,000-$70,000 price bracket. In October, it even outsold the smaller and more affordable EV6. The numbers speak to America’s love affair with big, family-friendly SUVs—especially ones that go electric. But now its hot streak may face a bumpy road ahead due to stricker battery sourcing rules.
Citing industry sources, The Korea Herald reported that the Hyundai Motor Group was holding back EV9 production at its Georgia plant due to stricter battery sourcing rules under the Inflation Reduction Act (IRA) that will be effective in 2025.
As per the report, the Georgia plant produced only 21 EV9s in the third quarter, of which only one was sold in the U.S. Kia sold nearly 2,000 units of the EV9 in October in the U.S., but it seems like most of those cars were made in Korea. We have reached out to Kia for a comment and will update this article when we hear back.
Gallery: 2024 Kia EV9 in US specification
The IRA prohibits automakers from sourcing battery components from the so-called "Foreign Entities Of Concern." Kia sources EV9 batteries from Korean battery maker SK On, but those cells are made in China, a designated FEOC. From 2025, rules will get even stricter, prohibiting even critical materials from being sourced from FEOCs.
Under the IRA, the percentage of critical minerals in EV batteries that must be sourced from the U.S. or its free-trade partners increases incrementally. For EVs entering service before January 1, 2024, that requirement was 40%. It will increase to 50% in 2024 and is expected to reach 60% in 2025 before reaching 80% in 2027 onwards.
The Hyundai Motor Group, of course, saw this coming. It is constructing two giant battery plants near the Metaplant in Georgia. Those projects are in collaboration with both SK On and LG Energy Solution. The SK On project is expected to produce enough batteries to support 300,000 EVs annually. The HMG-LGES factory is also expected to add similar capacity.
Finally, how this progresses is also contingent on what happens to the IRA when President-elect Donald Trump takes office next year. He's almost certainly set to gut the $7,500 consumer credits for EVs, but whether he will also repeal the manufacturing incentives for EVs and EV-related components remains to be seen.
