According to the South Korean newspaper Maeil Business and TV channel SBS, Kia Motors is planning to start manufacturing electric vehicles in the US starting in 2024. The automaker’s intention behind this move is very straightforward it wants Kia’s EVs to qualify for the US federal EV tax credits. The Inflation Reduction Act has laid some criteria following which an EV qualifies for federal tax credits. The automakers should build and assemble an EV in North America then the EV model would qualify for federal tax credits. There is also a requirement that EV’s battery materials should also be sourced from within North America but that has not been finalized yet.
Kia currently enjoys a strong position in the US EV market with impressive sales numbers and after Biden’s administration passed the Inflation Reduction Act, many foreign automakers like Kia Motors are forecasting a downfall in the sales numbers. Kia Motors does not want to lose its competitive edge in terms of pricing and see any disruptions in its plans for the US market. Hence is seeing this investment as a positive move for the company’s global plans and to meet the growing demand for EVs. Coupled with the benefits of tax credits, affordable EV offerings from Kia will become more affordable which is a fantasy for many EV enthusiasts.
Kia setting up an EV manufacturing plant in the US is a win-win situation for the US economy, it will promote manufacturing in the US, it will reduce its dependence on other countries and the affordability of Kia EVs will significantly boost EV adoption in the US. Starting to build EVs in the states will help Kia fix the issue of lack of availability of its EV & plug-in models and cement its place as a top EV manufacturer in the country.
Kia’s current lineup of electric vehicles in the US market offers some compelling options with stylish looks, a long battery range, and next-level charging speeds. Kia also has a few exciting new upcoming launches like the EV9 and plans to launch 14 EVs overall including an electric pickup by the year 2027. Local manufacturing of the EVs will help Kia price its models aggressively and give a tough fight to the industry leader Tesla.