Ajin Industrial is showing strong performance. It is interpreted that this is influenced by the news that the U.S. Department of the Treasury has reflected a significant portion of the position of Korean companies in the detailed guidelines of the Inflation Reduction Act (IRA).
As of 9:32 a.m. on the 3rd, Ajin Industrial is trading at 3,345 won, up 3.4% from the previous day.
According to the detailed requirements for the electric vehicle purchase tax credit under the IRA, released by the U.S. Department of the Treasury on the 31st of last month, only electric vehicles finally assembled in North America are eligible for the tax credit. Additionally, there is a condition that battery minerals must be sourced from the U.S. or countries that have a Free Trade Agreement (FTA) with the U.S.
A 40% sourcing ratio of battery minerals must be met to receive a $3,750 tax credit. The sourcing ratio of North American battery components must also be met. A 50% sourcing ratio is required to receive the remaining $3,750. This means a total tax credit of $7,500 can be received per electric vehicle.
Industry insiders expect Hyundai Motor Company to be able to receive subsidies for the first time soon, as it began producing the GV70 electric vehicle at its Alabama plant in February. Kia is also considering additional electric vehicle production at its existing Georgia plant. The completion of the new electric vehicle plant in Georgia, which is under construction with a target operation date of 2025, has also been expedited.
Meanwhile, Ajin Industrial is an outsourcing production company for Kia Motors' U.S. Georgia plant. It is known to supply moving parts that operate the body and engine. Ajin Industrial's U.S. subsidiary, Ajin USA, supplies moving parts that operate the body and engine to Kia Motors' U.S. Georgia plant.
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