Hyundai Motor Manufacturing Alabama (HMMA) has announced a new round of investments at its Montgomery plant to build the all-new Tucson and the refreshed Santa Fe, expand engine production and prepare for extended-range electric vehicle (EREV) technology. Announced on October 28, the package totals about $450 million, which Hyundai rounds up to "nearly $500 million" in its headline.
The new money brings Hyundai's total investment in HMMA to nearly $2.2 billion since production started in 2005. The investments were first announced late last month by Hyundai Motor Company President and CEO José Muñoz and are part of Hyundai Motor Group's $26 billion US investment commitment for 2025 to 2028.
What The Investment Covers
Engines: upgrades to HMMA's powertrain operations to build more engine variants, including technology for hybrid and EREV models.
All-new Tucson: new equipment, tooling and infrastructure for the fifth-generation Tucson, with production starting before the end of 2026.
Santa Fe facelift: preparations to build the refreshed Santa Fe.
Flexibility: a more flexible plant that can adapt its mix to changing customer demand.
All-New Tucson Production Starts Before Year-End
The blue SUV on display at the event is the all-new Tucson, Hyundai's best-seller worldwide. In Korea, it just set a record with over 15,000 pre-orders on its first day (record day-one pre-orders), and we have already spotted the US-spec version testing (US-spec Tucson spotted). Building it in Alabama from late 2026 means the new Tucson will reach American dealers as a locally made car.
Santa Fe Facelift And The Santa Fe EREV
The refreshed Santa Fe is the other model in the plan. Prototypes have been shedding their camouflage for weeks (Santa Fe facelift loses camouflage). The EREV part of the investment fits what Hyundai told investors in August: the Santa Fe EREV will be built at HMMA and arrive in the first half of 2027, with over 600 miles (about 965 km) of total range (Santa Fe EREV confirmed for US production). In an EREV, the gasoline engine only works as a generator to charge the battery, while the wheels are always driven by electric motors.
Why Alabama Matters
HMMA currently builds the Santa Fe, Santa Fe Hybrid, Tucson and Santa Cruz, and employs about 4,200 people. The announcement was made at a special event attended by Alabama Governor Kay Ivey, Kang Kyung-wha, Ambassador of the Republic of Korea to the United States, and Alabama Secretary of Commerce Ellen McNair. HMMA president and CEO Mark Rader said the investments will keep the plant at the heart of Hyundai's North American production for years to come.
Our Take
This is less about new capacity and more about getting HMMA ready for Hyundai's next wave of electrified models. With the Tucson, Santa Fe and Santa Fe EREV all built locally, Hyundai's best-selling SUVs in the US will be "Made in Alabama", a strong advantage as American buyers keep moving toward hybrids and Hyundai pushes to localize more of its production in North America.
Photos: Hyundai Motor America.
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