Hyundai Mobis supplies EV modules to Mercedes in US

South Korea’s top auto parts manufacturer Hyundai Mobis Co. has begun supplying key modules for Mercedes-Benz AG’s electric vehicles produced in the US, helping the luxury carmaker benefit from US tax credits that favor EVs made in North America.

Hyundai Mobis, a car components maker within South Korea’s largest automaker Hyundai Motor Group, said on Tuesday that it is now fully operating its new plant in McCalla, Alabama, to produce and supply chassis modules to Mercedes-Benz’s nearby US factory.

Chassis modules are the parts assembled under the car body, for example, as part of the steering, braking and suspension systems.

Mercedes-Benz plans to use Hyundai Mobis’ chassis modules for four of its all-electric sport utility vehicle models, according to the South Korean company. Hyundai Mobis has set up multimodal production equipment at the new factory that can manufacture different chassis modules for each of the four models.

The McCalla plant is Hyundai Mobis’ fifth US factory. It has production facilities in Alabama and Georgia that produce modules for the group’s carmakers Hyundai Motor Co. and Kia Corp., as well as plants in Michigan and Ohio for Chrysler.

Hyundai Mobis plans to spend $1.3 billion until 2030 to build auto parts and module plants for EVs in the US as the Biden administration provides a $7,500 tax credit for EVs assembled in North America.

ALREADY MET 70% OF 2022 OVERSEAS DEAL TARGET

The supply contract with Mercedes-Benz is expected to help Hyundai Mobis win more deals from global carmakers beyond just the Hyundai Motor Group. The company has already met 70% of this year’s target for overseas supply deals of $3.8 billion in the first half.

“We can maintain a long-term partnership once we establish a supply system, given the nature of the module business,” said Hyundai Mobis CEO Cho Sung-hwan. “We will seize more opportunities to win orders by increasing the trust with customers based on our excellent technology and stable supply capability.”

Hyundai Mobis has been supplying chassis modules to US carmaker Chrysler since 2006.

It also provides other key parts to other major automakers such as General Motors Co., Volkswagen AG and Zhejiang Geely Holding Group Co.

Write to Hyung-Kyu Kim at khk@hankyung.com
Jongwoo Cheon edited this article.