Kia Targets $30,000 Price Point with Mexico-Assembled EV3 for U.S. Market Amid Tax Credit Strategy

According to Korean Car Blog, as reported by Electrek, there is a possibility that the Kia EV3 electric SUV will be manufactured in Mexico for the American market. This strategy might enable the vehicle to qualify for a federal tax credit, potentially setting the sale price at $30,000.

Kia is in the process of creating a unique model of the EV3 specifically for the North American market, which will be manufactured at the company's plant in Monterey, Mexico, commencing from the following year, as per the report. The model, with the internal designation SVm, is expected to enter the trial phase sometime later this year.

Kia's Electric Vehicle Model

Kia is said to be planning an increase in vehicle production in Mexico, where it hopes to manufacture as many as 110,000 vehicles each year starting in the last quarter of 2025. This figure surpasses the initial production goal of 100,000 vehicles at the Gwangmyeong facility in South Korea, where the EV3 model began production. The South Korean plant is expected to cater to the demands of both the local and European markets, the report suggests.

Last month, Kia unveiled the EV3 and teased the possibility of certain models achieving over 300 miles on a single charge. Previously, the car manufacturer hinted that the starting price would be in the vicinity of $35,000. However, in Korea, pricing begins at approximately $30,000, indicating that there could be efforts to align the prices more closely.

Kia's Electric Vehicle Model

Kia is expected to concentrate on qualifying for electric vehicle (EV) tax credits which could potentially reduce the net cost for numerous households to approximately $25,000 or even lower, destination charges included. EVs manufactured in Mexico are eligible for the federal tax credit, and due to Mexico's trading position, Kia would not be subject to import taxes, as pointed out by Korean Car Blog.

Kia might be facing challenges in developing a strategy to produce affordable electric vehicles in the area below the US border. Ex-president Donald Trump had suggested imposing a double tax on all vehicles from China, electric ones included. Furthermore, if he wins the election again, he's hinted at tightening the largely unrestricted trade agreements with Mexico that were set up through NAFTA. Additionally, there are rumors that he's willing to eliminate incentives introduced by the Biden administration, such as the tax credit for electric vehicles, in return for financial support from major oil companies for his campaign.

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