Auto parts maker Shinhwa Auto USA is investing $114 million to expand its manufacturing operations in Auburn, Alabama, state officials announced last week.
The plant will expand the driveshaft manufacturer’s die-casting operations as well as add associated processes needed to make control arm, knuckle, carrier and motor housing covers for a new EV parts contract, according to the release. Shinhwa has been making parts for Hyundai Motor Group’s assembly plant in Montgomery, Alabama, and Kia’s assembly plant in West Point, Georgia, since it opened its first facility in 2020.
The project will include the construction of a 170,000-square-foot facility and is the South Korea-based company’s third expansion since choosing the site in 2019. It is expected to create 50 jobs with an average salary of approximately $48,000, according to the Alabama Department of Commerce.
Shinhwa invested $42 million to establish its first U.S. manufacturing facility in Auburn in 2019, but expansion was always part of the auto parts maker’s plans. The company announced its first expansion to its Auburn campus last year, investing $78 million to build a 400,000-square-foot factory across from the first facility. The building will increase Shinhwa’s aluminum part manufacturing capacity and meet EV production demands.
“Alabama’s auto sector is experiencing a major growth spurt as the industry accelerates the transition toward an electric future,” Alabama Department of Commerce Secretary Greg Canfield said in a statement. “We look forward to working with Shinhwa to advance its expansion plans and fully develop the growth potential of its Auburn manufacturing operation.”
Shinhwa’s expansion comes as its customers, such as Hyundai and Kia, are ramping EV production. Earlier this year, Hyundai’s assembly plant in Montgomery began production of its Genesis Electrified GV70 SUV. The South Korea-based automaker is also building a $5.5 billion EV manufacturing campus in Ellabell, Georgia.
Last month, Kia announced plans to invest over $200 million to expand its manufacturing facility in West Point, Georgia. The expansion will enable the West Point site to produce its new electric SUV model beginning in Q2 of next year.
Shinhwa is one of many suppliers expanding or building plants to support auto makers’ EV manufacturing hubs in North America. Hanon Systems, another Hyundai supplier, is investing nearly $170 million to establish an auto thermal systems manufacturing facility in Loudon, Tennessee. In May, Hanon also announced it would set up shop in Georgia, near Hyundai’s upcoming $5.5 billion manufacturing campus in the state.
Last month, Ford supplier Magna International made plans to invest over $790 million to build three facilities in Tennessee, two of which will be part of Ford’s BlueOval City supplier park. Ford is currently building a $5.6 billion EV manufacturing campus in the state.