Kia may be planning to expand its assembly plant in northeast Mexico to build future electric vehicles as Hyundai Motor Group maneuvers to become the No. 3 global EV maker.
According to a Facebook post by Samuel Garcia, governor of the Mexican state Nuevo Leon, company officials have expressed interest in investing $1 billion to upgrade their existing factory near Monterrey to produce new EVs.
Getting Kia's Mexico plant into the EV and batteries business would speed up the localization of its product line in North America, a crucial step for Hyundai Motor Group, which controls the Hyundai, Genesis and Kia brands.
Though all three brands offer EVs in the U.S. market, they are not eligible for the federal government's $7,500 EV tax credit under the Inflation Reduction Act because their batteries are imported and the materials used are sourced outside of North America.
The Korean automaker has made efforts to navigate the complex barriers of the new tax credit rules, including lobbying U.S. officials, but its situation has not changed.