Genesis Electrified GV70 first Hyundai Motor Group EV to earn tax credit

The electric version of Genesis' 2023 GV70 crossover will be the first Hyundai Motor Group vehicle to qualify for the $7,500 federal EV credit under the Inflation Reduction Act, which allows eligibility to EVs assembled in North America that fall under a certain price.

This is significant for the Korean automaker because it was stung by the U.S. government's changes to the EV tax rules last year, which rendered its hot-selling EVs ineligible for the credit.

The new Genesis EV — called the Electrified GV70 — is also the luxury brand's first vehicle to be built in the U.S., and the first to be built outside South Korea.

Currently in production at Hyundai's factory in Montgomery, Ala., the Electrified GV70 will be offered in two trims — the Advanced and the Prestige — and will cost $66,975 and $73,775, respectively, with $1,125 destination.

Eligible EVs categorized as crossovers must come in below $80,000 to qualify for the federal credit.

Also to be determined are the details of the Genesis' battery sourcing and the supply of the critical minerals needed to produce the battery. Clarification is expected next month from Washington on how those issues will affect the $7,500 tax credit. The income of the EV's buyer also affects whether the credits can be applied.

The Electrified GV70 is the third EV from the burgeoning premium brand. The electric version of Genesis' G80 sedan and the GV60, a dedicated compact crossover that's smaller than the GV70, went on sale last year and are both imported from Korea.

The GV60 was tax credit-eligible for a short time before the revision in August eliminated imported EVs from eligibility. The Electrified G80 was never eligible because it went on sale after the changes.

The Electrified GV70's U.S. production launch marks a milestone for Hyundai Motor Group, which has committed to building EVs in the U.S. as part of a push to sell 3.2 million EVs a year globally by 2030. Genesis has pledged to have an all-electric lineup in the same time frame.

While the Electrified GV70 is the first, its volume is unlikely to match that of the Hyundai- and Kia-branded imported EVs that are already on sale and remain ineligible for the tax credit.

The group captured early EV market share with its Hyundai Ioniq 5 and Kia EV6 crossovers. Both brands topped 20,000 sales in their first year and, unlike Tesla and other luxury EV makers, targeted mainstream buyers.

The brands got an additional boost from electric variants of the Hyundai Kona and Kia Niro. Those compact crossovers share a platform and just entered their second generation. Last year, they logged combined sales of 12,740, according to data from Motor Intelligence.

Hyundai and Kia also have forthcoming EVs — the Ioniq 6 sedan and the three-row EV9 — that will bring affordable EVs options to other high-volume segments.Those models are not eligible for any federal incentives.

Additionally, months before changes to the tax credit eligibility were announced last summer, HMG committed $5.5 billion to construct an EV and battery factory outside Savannah, Ga., for its Hyundai, Genesis and Kia brands. The plant's capacity will start at 300,000 EVs with the potential to increase to 500,000 as demand increases.

The plant is under construction, but officials say production will not begin until the third quarter of 2024 at the earliest and the batteries will not be ready until 2026. HMG's battery partner for that EV complex is unknown.

HMG has said it will partner with South Korean battery maker SK On to make power packs for EVs at another location that has yet to be announced.