Hyundai Motor is taking significant steps to align its electric vehicle (EV) models with the U.S. Department of Energy’s strict requirements under the Inflation Reduction Act (IRA). The batteries of three flagship EV models—the IONIQ 5, IONIQ 9, and Genesis GV70—will be replaced with versions free of regulated minerals to regain eligibility for federal subsidies. Kia models will also follow suit with updated battery systems.
Why the Change?
The U.S. government offers subsidies exclusively to electric vehicles that meet the following conditions:
1. Production in the U.S.
2. Compliance with parts and mineral sourcing requirements.
Batteries containing parts or materials sourced from countries like China or Russia are automatically disqualified from these incentives. Initially, Hyundai’s EVs met these requirements and were deemed eligible for subsidies. However, in an unexpected reversal, the U.S. Department of Energy removed these models from the subsidy list just two weeks later due to their battery composition.
When Will the New Batteries Roll Out?
According to industry sources on January 21, Hyundai plans to introduce the updated batteries for its EVs in the U.S. as early as March 2025. This strategic move will ensure compliance with IRA standards, making the vehicles more competitive in the U.S. market by restoring eligibility for subsidies.
Kia and Genesis Following Suit
In addition to Hyundai, Kia and Genesis are also set to equip their electric vehicles with new batteries free of restricted minerals. This development reflects a broader commitment by the Hyundai Motor Group to adapt to evolving regulatory standards while maintaining its strong foothold in the U.S. EV market.
President Trump’s Announcement on EV Mandates
Complicating the landscape for EV manufacturers, President Donald Trump, who returned to office on January 21, 2025, announced plans to abolish the “electric vehicle mandate.” The mandate has been a cornerstone of U.S. policies aimed at accelerating EV adoption. In his statement, Trump criticized what he called “unfair subsidies that effectively mandate the purchase of electric vehicles.” The potential rollback of these policies could shift the trajectory of the U.S. EV market.
Implications for the EV Market
These developments highlight the dynamic and sometimes unpredictable nature of the EV market in the U.S. While Hyundai and other automakers are working to align their products with IRA regulations, the possibility of policy changes under President Trump adds uncertainty to the market.
By introducing batteries that comply with U.S. sourcing requirements, Hyundai, Kia, and Genesis aim to secure their competitiveness in a growing yet challenging landscape for electric vehicles.
