The EV Supply Chain Gold Rush: Why Hyundai and GM's U.S. Bets Signal the Future of Auto Investing

The automotive industry's transition to electric vehicles (EVs) has sparked a historic shift in supply chain strategies, with automakers racing to secure control over critical minerals, manufacturing capacity, and domestic partnerships. Nowhere is this more evident than in North America, where Hyundai's $21 billion U.S. investment and GM's $35 billion+ focus on critical minerals and recycling are reshaping the landscape. These moves are not just about building cars—they're about laying the groundwork for long-term market dominance and shielding against geopolitical risks. For investors, this is a once-in-a-generation opportunity to bet on companies that are securing the raw materials and partnerships needed to lead the EV era.

Hyundai's $21B Stakes: Steel, Batteries, and the "Auto Cluster" Play

Hyundai's massive U.S. investment—$21 billion through 2028—is a masterclass in supply chain vertical integration. A cornerstone is its $6 billion Louisiana steel mill, which will produce 2.7 million tons of low-carbon steel annually using U.S. scrap. This isn't just about reducing reliance on imported steel; it's about locking in a key material for EV production while complying with U.S. policies like the Inflation Reduction Act (IRA), which mandates a growing percentage of critical minerals be sourced domestically.

Equally critical is Hyundai's focus on battery partnerships. The company is working with NVIDIA on AI-driven autonomous systems, Waymo on robotaxis, and Supernal on air mobility—a broader play to dominate future transportation ecosystems. Its $9 billion allocation to expand U.S. production capacity to 1.2 million vehicles annually, including its Georgia Metaplant for EVs, signals a shift toward a "North American auto cluster" model. This mirrors the integrated supply chains of the 20th-century automotive industry but tailored to EVs.

GM's Mineral Play: Recycling, Cobalt, and the Race Against China

While Hyundai is building factories, GM is weaponizing its control over critical minerals. Its $35 billion investment includes partnerships like the Thacker Pass lithium project in Nevada (with Lithium Americas) and a joint venture with Vianode for synthetic graphite—anodes for batteries. The company's collaboration with MP Materials for rare earth metals and its Sumter, South Carolina, magnet plant underscore its focus on securing materials that are often bottlenecked in China.

Recycling is another pillar. GM aims to reduce reliance on virgin minerals by reprocessing battery components, aligning with IRA mandates that demand 50% (rising to 60% by 2025) of critical minerals in EV batteries be sourced from North America or recycled within the region. This strategy isn't just about compliance—it's about building a circular supply chain that insulates GM from cobalt shortages or lithium price spikes.

Risks: Tariffs, Mineral Volatility, and Geopolitical Tensions

Despite the optimism, risks loom. The IRA's escalating thresholds for domestic content could strain suppliers, while trade wars—such as the EU's proposed carbon border tax—threaten to disrupt cross-border supply chains. Mineral shortages remain a wildcard: cobalt is concentrated in politically unstable regions like the DRC, and lithium mining faces environmental hurdles.

For investors, the key is to bet on firms that have secured long-term mineral partnerships or control over recycling tech. GM's cobalt deals with Glencore and its lithium projects offer a hedge against volatility. Hyundai's Louisiana steel mill, meanwhile, reduces exposure to global steel price swings.

The Investment Play: Follow the Minerals and the Factories

The takeaway is clear: automakers that dominate North American supply chains will thrive. Here's how investors can capitalize:

1. Focus on U.S.-centric supply chains: Companies like GM and Hyundai, with major U.S. investments in manufacturing and minerals, are positioned to benefit from IRA tax credits and domestic demand.
2. Track mineral partnerships: Firms with deals for lithium (e.g., GM's Nevada project) or cobalt (e.g., Glencore's feedstock for Australia's Kwinana refinery) reduce exposure to price spikes.
3. Bet on recycling tech: Companies like Redwood Materials (a Tesla supplier) or GM's own recycling initiatives could become critical as mineral recycling becomes mandatory.

Conclusion: The New Rules of Auto Investing

The EV era is rewriting the rules of the automotive industry. Hyundai and GM are proving that the winners won't just be the best at building EVs—they'll be the ones that control the raw materials and the factories. For investors, this means looking beyond stock charts and focusing on the ground game: where are the mines, the steel mills, and the recycling plants? The answer lies in North America, and the companies leading this shift are the ones to watch.

The next decade will belong to automakers that mastered the supply chain. Investors who follow their bets will profit.