Hyundai Says Battery Plant Delayed After Immigration Raid
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Construction on a Hyundai Motor Co.-LG battery plant in Georgia that was raided by U.S. immigration authorities is being delayed as the companies face labor shortages.
The work is being set back by several months following last week’s disruption, Hyundai CEO José Muñoz said in an interview Sept. 11.
“This is going to give us minimum two to three months delay, because now all these people want to get back,” he said. “Then you need to see how can you fill those positions. And for the most part, those people are not in the U.S.”
The comments show the growing fallout from the Sept. 4 raid in which federal agents detained 475 workers, mostly South Koreans, at the battery plant site that’s jointly operated by Hyundai and LG Energy Solution Ltd. With images of detainees shackled at the wrists, waist and ankles, the shock operation has reverberated throughout the industry and strained diplomatic ties between Seoul and Washington.
A Korean Air chartered plane takes off to bring back workers detained in an immigration raid in Georgia, at Incheon International Airport on Sept. 10. (Yonhap via AP)
With the new plant delays, Hyundai will source batteries from an SK On Co. plant in Commerce, Ga., Muñoz said.
LG said in a statement that it’s “committed to our projects in the U.S. and will continue to navigate the circumstances with the aim to continue necessary investments and business.”
Efforts to repatriate workers are moving forward and the chartered plane bringing them back isexpectedto depart the U.S. on Sept. 11 and arrive in Korea on Sept. 12.
But the economic ramifications are potentially just beginning.
The operation has cast doubt over billions of dollars of Korean companies’future investmentin the U.S. Construction has been disrupted at multiple LG Energy Solution sites across the U.S., while some South Korean staff are balking at assignments over fears of being caught in similar crackdowns.
“I’m really worried about that incident and we’re really glad they’re returning home safely,” Hyundai Motor Group Chairman Euisun Chung said Sept. 11 at the Automotive News Congress. “Our government and the U.S. government are working closely, and the visa regulation is very complicated. I hope we can make it, together, a better system.”
The timing of the raid came soon after South Korean President Lee Jae Myung and President Donald Trump met to bolster their alliance.
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Commerce Secretary Howard Lutnick on Sept. 11 suggested Trump plans to help facilitate short-term visas for foreign skilled workers needed to build new factories.
“I think he’s going to make a deal with different countries that when they want to build big here, he’ll find a way to get their workers proper work visas, meaning short-term work visas, train Americans and then head home,” Lutnick said in a CNBC interview.
Hyundai pledged recently toincreaseits investment in the U.S. to $26 billion through 2028, up from the$21 billionit had promised in March. That earlier plan included $9 billion to increase U.S. vehicle production, and $12 billion on other initiatives, including a new steel mill in Louisiana.
Muñoz said Sept. 11 that Hyundai is still committed to the U.S.
“Even though this has been a very unfortunate incident, the strategic importance of the U.S. market for our company doesn’t change,” he said. “We have been making a lot of investments over the last few years and we will continue.”
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