SAVANNAH, Georgia – Hyundai Motor Co will break floor on a $5.54 billion electrical car (EV) and battery plant in america on Tuesday, as South Korea’s largest automaker grapples with an unsure outlook for its EV gross sales in its high market.

Hyundai plans to start industrial manufacturing within the first half of 2025 within the large plant in Bryan county, west of Savannah, that may have an annual capability of 300,000 items.

Georgia Governor Brian Kemp, a Republican, and its two U.S. senators, Jon Ossoff and Raphael Warnock, each Democrats, plan to attend the occasion. Kemp and Warnock are up for re-election subsequent month.

The groundbreaking comes amid anger from Korea and the European Union over U.S. electrical car tax coverage.

The Inflation Discount Act President Joe Biden signed in August requires EVs to be assembled in North America as a way to qualify for U.S. tax credit. Hyundai and its affiliate Kia, in addition to main European automakers, have been excluded from the EV subsidies as they don’t but make the autos there.

The regulation made about 70 % of EVs instantly ineligible for the tax credit of as much as $7,500 per car.

Gross sales of the Hyundai Ioniq 5 crossover SUV in america slumped round 14 % in September from the earlier month, hit by the brand new U.S. regulation.

Concern over Hyundai’s U.S. EV gross sales underneath the brand new rules was cited by analysts when the corporate introduced quarterly outcomes on Monday and in addition contributed to its shares falling.