Hyundai plans $55.8 billion push, aims to double US local production

Hyundai Motors plans to raise output to 6.2 million vehicles by 2030. The carmaker has trimmed FY25 profit outlook due to US tariffs, but will press ahead with expansion plans

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South Korean carmaker Hyundai Motor announced plans to invest more than $55.8 billion over five years starting 2026, a 10 per cent increase from its 2024 investment plan, Nikkei reported on Thursday. Hyundai will also scale up production in the US to counter the Trump administration’s tariffs, targeting more than 80 per cent of all vehicles sold in the country to be manufactured domestically. This would effectively double its current local production ratio.

 

Investment break-up 

- $22.1 billion allocation for R&D

 

Hyundai is earmarking a massive sum for innovation, signalling its intent to lead in areas such as electric vehicles and next-gen mobility technologies.

   

- $27.4 billion for facility expansion

 

More than half of the total planned outlay will be spent on manufacturing infrastructure.

   

- 6.2 million vehicles by 2030

 

Hyundai aims to lift annual production output to this level, a significant jump from its present capacity.

   

- 20 per cent increase from current capacity

 

This planned rise shows Hyundai’s growth ambitions in a competitive global market.

   

Global footprint expansion 

 

Alongside the US, the automaker will expand capacity at factories in India and South Korea, and at a plant in Saudi Arabia scheduled to begin operations next year.

 

Localisation push in US 

To cushion the impact of US tariffs on imported vehicles, Hyundai aims to manufacture more than 80 per cent of the cars it sells in the US at local plants by 2030. At present, the local production is around 40 per cent.

The company also plans to increase procurement of raw materials and components from US suppliers, such as batteries and steel, raising the share from 60 per cent currently to 80 per cent.

 

ICE raid delays battery plant 

On September 4, the US Immigration and Customs Enforcement (ICE) agency raided the construction site of a battery facility jointly funded by Hyundai Motor and South Korea’s LG Energy Solution, detaining 475 people. The development is expected to delay construction, but Hyundai has reaffirmed its commitment to continue investing in the US.

Jose Muñoz, president and chief executive of Hyundai Motor Company, said at an investor day in New York on Thursday that many of those detained were engaged in calibrating and testing advanced battery production technology at a plant supporting Hyundai’s US operations.

 

US expansion strategy 

Hyundai is in the process of investing $26 billion from 2025 to 2028 to grow its operations in America. “This isn’t just about tariff mitigation, it is about building the most advanced, efficient manufacturing ecosystem in the automotive industry,” Muñoz said.

He hoped, “…the US and South Korea can work out mutually beneficial solutions for short-term business travel” for specialised workers. It marked the first time the company had hosted the event outside South Korea, and the first investor meeting chaired by Muñoz since his promotion to chief executive earlier this year.

 

Revised profit target 

Factoring in the impact of US tariffs, Hyundai trimmed some of its performance goals. The company cut its operating profit margin target for fiscal 2025 by one percentage point from its previous forecast, revising it to a range of 6 to 7 per cent.