Hyundai Offers $7,500 Incentive to Boost American EV Sales, Aims to Accelerates EV Adoption

Jan 22, 2024 10:46 PM EST

BLUE HYUNDAI VENUE PARKED ON A PARKING LOT — (Photo : PEXELS/HYUNDAI MOTOR GROUP)

Though time is running out on this exclusive deal, prospective buyers of Hyundai electric cars now have the chance to profit handsomely financially. As to a Bloomberg report, Hyundai Motor Co. is offering cash incentives of up to $7,500 to individuals who purchase electric vehicles in the United States through January 31.

Competing with Other EVs, Hyundai's $7,500 Incentive

With this hefty incentive, HYUNDAI Motor hopes to support its EV sales in the US market and stay competitive with automakers qualified for tax credits under President Joe Biden's Inflation Reduction Act (IRA). These generous discounts are applicable to the Ioniq 5, Ioniq 6, and Kona Electric models.

According to information on its official website, the South Korean carmaker has made it clear that this month-long promotional deal will be valid until January 31. Encouraging domestic EV production and component manufacturing, the clean vehicle tax credit program did not accept Hyundai's electric vehicles as meeting the eligibility conditions.

The Business Times shared details about this development. Hyundai is offering a $7,500 incentive for customers who buy electric vehicles this month. The offer come as their eligibility for a federal tax credit of the same amount expired in December.

Hyundai is attempting to compete with US manufacturers that are eligible for federal tax credits by providing EV buyers in the US with a $7,500 cash bonus. Customers must purchase cars from dealer stock and receive delivery by January 31 in order to take advantage of this promotion.

This reduction can be collected as a check later on or used as part of the down payment on the cars.

Currently, only six electric vehicles were still eligible for the tax credit based on the updated eligibility standards. Reportedly, insufficient domestic manufacture of Hyundai's electric vehicle components resulted in the vehicles losing their eligibility for the federal tax credit.

Hyundai and its affiliate Kia sold over 69,000 electric cars in America. Their sales record makes them the second-largest producer of EVs in the country. It becomes second in the list after Tesla. This data is based from a study by BloombergNEF.

Hyundai's Facility in Georgia

Hyundai does not have electric vehicles facility in operation in the United States. The company is actively developing facility for electric vehicles in Georgia. As early as the end of 2024, construction is expected to start.

Hyundai and other companies that sell imported vehicles have continued to benefit from the legislation. This is because dealers have the flexibility to apply the credit to any electric vehicle lease, regardless of its place of origin, in order to lower the monthly payments for customers.

Nevertheless, the legislation is compelling Hyundai to accelerate its efforts in manufacturing batteries and electric vehicles within the United States. Hyundai President and Global COO, José Muñoz stated that the company is hastening construction with the aim of commencing production in Georgia at some point in 2024.

Muñoz, explained to the Associated Press that their decision is to double down on their efforts. He expressed their intention to accelerate the project as much as possible and expressed confidence that the original target date of January 2025 may be advanced, possibly by around three months or even more, if feasible.

Additionally, Muñoz noted that the construction at the facility located near Savannah is advancing swiftly and remained unaffected by Hurricane Idalia. Hyundai stands to potentially receive $2.1 billion in tax incentives from state and local authorities, with a commitment to providing its employees with an annual average salary of $58,105, along with benefits.

In conclusion, Hyundai's strategic push to incentivize electric vehicle purchases in the US underscores its commitment to the growing EV market. As it accelerates construction for domestic production in Georgia, Hyundai seeks to secure its position amid competition and evolving tax policies, with ambitions to become a major player in America's green automotive future.

The $7,500 cash incentive, Hyundai's construction efforts, and its potential $2.1 billion in tax breaks all contribute to this forward-looking strategy.