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Raid halts construction of major car battery factory in

Georgia

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Project is part of biggest investment in the state

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475 workers arrested in largest DHS enforcement operation

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Raid could strain US-South Korea relations amid trade

tensions

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Hyundai and LGES pause construction

(Adds new Hyundai statement in paragraphs 8-9)

By Hyunjoo Jin, Heekyong Yang, Ted Hesson and David

Shepardson

ATLANTA/WASHINGTON/SEOUL, Sept 5 (Reuters) - Hundreds of

workers at a Hyundai Motor ( HYMLF ) car battery facility

under construction in Georgia were detained in a raid by U.S.

authorities on Thursday, stopping work on a plant that is one of

the Korean automaker's major investments in the U.S.

About 475 workers, most of whom were South Korean nationals,

were arrested, according to U.S. immigration officials, the

largest single-site enforcement operation in the U.S. Department

of Homeland Security's (DHS) history.

President Donald Trump's administration has been escalating

a crackdown on immigrants, disrupting businesses around the

country, even as the White House has encouraged more inflows

from foreign investors.

The arrests could exacerbate tensions between Washington and

Seoul, a key ally and investor in the U.S. The countries have

been at odds over the details of a trade deal that includes $350

billion of investments. At a summit last month, South Korea

pledged $150 billion in U.S. investments - including $26 billion

from Hyundai Motor ( HYMLF ).

Homeland Security officials said the workers arrested at the

Ellabell, Georgia, site were barred from working in the U.S.

after crossing the border illegally or overstaying visas. The

investigation took place over several months, Steven Schrank,

special agent in charge of investigations for Georgia, said

during a press briefing.

"This was not an immigration operation where agents went

into the premises, rounded up folks and put them on buses," he

said. Schrank said there was a network of subcontractors on the

site.

A Hyundai Motor ( HYMLF ) spokesperson said none of the people

detained were employed directly by the automaker.

The company said its chief manufacturing officer for North

America, Chris Susock, would "assume governance of the entire

megasite in Georgia."

"We will conduct an investigation to ensure all suppliers

and their subcontractors comply with all laws and regulations.

Hyundai has zero tolerance for those who don't follow the law,"

it said.

The arrested workers were being held at ICE's Folkston,

Georgia, detention facility, Schrank said. Most of the 475

people are South Korean nationals, he said. Korean media has put

the number of South Koreans detained at roughly 300 people.

The raid - dubbed "Operation Low Voltage" - included more

than 400 law enforcement officers after a months-long

investigation.

A spokesperson at Hyundai's battery joint venture partner,

South Korean battery maker LG Energy Solutions, said

in a statement it was cooperating and had paused construction

work. The facility, a joint venture between LGES and Hyundai

Motor ( HYMLF ), was due to start operations at the end of this year,

according to LGES.

Hyundai Motor ( HYMLF ) shares ended down 0.7% on Friday, and LGES

shares dropped 2.3%.

'LARGEST DEVELOPMENT PROJECT'

Under Trump, Immigration and Customs Enforcement, or ICE,

part of DHS, has driven the Republican leader's sweeping

crackdown on migrants, bolstered by record funding and new

latitude to conduct raids.

Trump has said he wants to deport "the worst of the worst"

criminals but ICE figures have shown a rise in non-criminals

being picked up. Rights advocates have denounced such raids.

The White House said on Friday that "any foreign workers

brought in for specific projects must enter the United States

legally and with proper work authorizations."

South Korea's Foreign Ministry expressed regret and concern

about the raid. "The economic activities of our companies

investing in the United States and the interests of our citizens

must not be unduly violated during the course of U.S. law

enforcement," ministry spokesperson Lee Jae-woong said in a

statement on Friday.

Social media video showed a man wearing a vest with the

letters HIS, an acronym for Homeland Security Investigations,

telling workers in yellow safety vests: "We have a search

warrant for the whole site. We need construction to cease

immediately. We need all work to end on the site right now."

The U.S. Department of Justice in a statement said several

people tried to flee during the raid. Some had to be fished out

of a sewage pond on the site, DOJ said.

Georgia's Democratic Party condemned the raid, calling it

part of "politically-motivated fear tactics designed to

terrorize people who work hard for a living, power our economy,

and contribute to the communities across Georgia that they have

made their homes." In a statement, a spokesman for Georgia

Governor Brian Kemp said: "In Georgia, we will always enforce

the law, including all state and federal immigration laws."

Hyundai said its production of electric vehicles at the

sprawling site was not affected.

In 2023, Hyundai Motor ( HYMLF ) and LG Energy announced the $4.3

billion venture to produce EV battery cells, with each company

holding a 50% stake. The plant will supply batteries for

Hyundai, Kia and Genesis EV models.

The battery factory is part of Hyundai's $12.6 billion

investments in the state, including the automaker's just-opened

car factory, in what would be "the largest economic development

project in the state's history."