Hyundai Motor Co revealed that it has finalsied a $5 billion joint venture with partner SK in North America. Uner the electric vehicle (EV) battery joint venture, the company will be setting up a new battery manufacturing plant in the state of Georgia, the companies said, formalising an earlier provisional agreement.

The automaker reported an overall profit of 3.3 trillion won ($2.47 billion) for the January-March period versus a profit of 1.6 trillion won a year earlier, thanks to an upsurge in vehicle output as a global chip shortage eased and demand for its high-margin sport-utility vehicles remained strong.

“The strong sales mainly stemmed from the improvement of production as chip and component supplies stabilized worldwide," Hyundai said. It added it sees “persistent external factors, such as expanding inflation and fluctuation of raw material costs and interest rates due to geopolitical issues."

As part of the partnership, both South Korean firms will receive an equal shareholding in the plant, to be constructed in Bartow county, Georgia. It’s anticipated the facility will produce EV battery cells starting in the second half of 2025.

The new plant should have an annual production capacity of 35 GWh of EV battery cells, enough to produce 300,000 all-electric vehicles.

The joint venture “further accelerates the group’s electrification efforts and bolsters its position as an EV leader in the US market with a stable battery supply," Hyundai said in a statement. The carmaker signed a memorandum of understanding with SK On to secure battery supply for North America last November.