Hyundai Motor: "Even if Trump is elected, it will be difficult to abolish the IRA"

IRA Benefits Most Republican-Leaning Areas
Responding to Support Cuts by Expanding Hybrid Sales

[Image source=Yonhap News]

Hyundai Motor Company expressed confidence that it can achieve solid performance regardless of the outcome of the U.S. presidential election. The company believes that even if former President Donald Trump is elected, repealing the Inflation Reduction Act (IRA) will be difficult.

On the 25th, Lee Seung-jo, Executive Vice President and Chief Financial Officer (CFO) of Hyundai Motor's Finance Division, stated during a conference call following the Q2 earnings announcement, "If former President Trump takes office, there is a high possibility of repealing or reducing the IRA, easing eco-friendly regulations, and imposing universal tariffs," but he also noted, "Most of the states benefiting from the IRA are battleground states and are controlled by the Republican Party, so repealing the IRA will not be easy."

For this reason, Hyundai is preparing countermeasures mainly for the scenario where the IRA is reduced. In such a case, the company plans to respond by expanding the sales proportion of hybrid vehicles. EVP Lee explained, "Easing eco-friendly regulations could be an opportunity to save on our regulatory compliance costs," adding, "Based on Hyundai's greatest strength, flexible production, we are considering a plan to significantly increase hybrid vehicle sales volume if the scale of IRA support is reduced."

Hyundai has already changed the 'Hyundai Motor Group Meta Plant America (HMGMA),' scheduled to start operations in Q4, from an electric vehicle-only factory to a plant capable of producing hybrids as well.

Meanwhile, Hyundai plans to hold the 2024 CEO Investor Day at the end of next month to announce its future management strategy, financial goals, and mid- to long-term shareholder return policies. Changes in vehicle production related to the U.S. presidential election and the production ratio of hybrid vehicles are also expected to be disclosed in detail on that day.