SEOUL – The South Korean government has officially voiced its "grave concern" regarding the investment environment in the United States following an unannounced federal raid on a major battery manufacturing facility jointly operated by Hyundai Motor Group and LG Energy Solution. The incident threatens to cast a shadow over the robust economic alliance between the two nations and could potentially chill future Korean investments in American manufacturing.
The raid, which reportedly took place at the sprawling electric vehicle (EV) battery plant in Georgia, involved dozens of agents from a U.S. federal agency. While American authorities have remained tight-lipped, citing an ongoing investigation, sources suggest the probe is related to alleged labor and workplace safety violations.
In a strongly-worded statement released Thursday, South Korea's Ministry of Trade, Industry and Energy called the nature of the raid "deeply regrettable and concerning."
"We have the utmost respect for the laws and regulations of the United States," the statement read. "However, the sudden and forceful nature of this action against a key partner and major investor, without prior diplomatic consultation, is highly unusual. This sends a worrying signal to other Korean companies that have committed billions to supporting America's manufacturing and clean energy goals."
The ministry confirmed it has lodged a formal inquiry through diplomatic channels, demanding transparency and adherence to due process for the companies involved.
The Hyundai-LG facility is a cornerstone of the two companies' multi-billion dollar investment strategy in the U.S., spurred in part by incentives from the Inflation Reduction Act (IRA). These investments are critical for building a stable domestic supply chain for electric vehicles and are projected to create thousands of American jobs.
In a joint corporate response, Hyundai and LG stated they were "surprised by the raid" but are "cooperating fully with the authorities."
"We are committed to upholding the highest standards of labor practices and workplace safety at all of our facilities globally," the statement said. "We are confident that the investigation will confirm our adherence to all applicable U.S. laws and we are dedicated to resolving this matter swiftly."
The incident comes at a particularly sensitive time. South Korean conglomerates, including Samsung, SK, Hyundai, and LG, have emerged as some of the largest foreign investors in the U.S. Their commitments, particularly in the semiconductor, EV battery, and green technology sectors, are seen as vital to the current U.S. administration's industrial policy.
Analysts warn that the fallout from the raid could be significant.
"This is more than just a corporate issue; it's a diplomatic one," said Michael Kim, a senior analyst at the Seoul Economic Institute. "The predictability and stability of the U.S. market are the bedrock of these investment decisions. An action perceived as heavy-handed or politically motivated could cause companies to reconsider the scope and pace of their future U.S. expansion. Seoul's swift and public response underscores how seriously they are taking this potential threat to their flagship corporations."
The U.S. government has yet to issue a detailed public statement. A spokesperson for the Department of Labor would only comment that the agency "is committed to ensuring all companies operating on U.S. soil adhere to federal regulations that protect the health, safety, and rights of workers."
As both corporate and diplomatic discussions continue behind the scenes, the global business community is watching closely. The outcome of the investigation—and Washington's handling of Seoul's concerns—will likely have lasting repercussions on the future of foreign direct investment in the United States.
