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US raid disruptions spread, casting pall on Korea investment

Hyonhee Shin, Haram Lim and Youkyung Lee, Bloomberg News on

Published in Business News

Fallout from last week’s unprecedented immigration raid at a Georgia battery plant run by two South Korean firms is reverberating across the industry, highlighting risks to the billions of dollars the Asian nation has invested in America’s clean energy push.

Construction has now been disrupted at multiple LG Energy Solution Ltd. sites across the U.S. while some Korean staff are balking at assignments over fears of being caught in similar crackdowns as the Trump administration vows tougher enforcement, people familiar with the matter said.

LG Energy has ordered the immediate return of all workers and contractors traveling under the U.S. visa waiver program, known as ESTA, and advised those on short-term B-1 visas to remain at their hotels, one person said, asking not to be identified discussing internal guidance.

A Korean Air Lines Co. Boeing 747-8 from Seoul landed Wednesday morning at Hartsfield-Jackson Atlanta International Airport, but the charter plane’s expected departure from Atlanta with South Korean nationals detained by U.S. immigration authorities has been delayed, the airport said.

“The transport and departure operation planned for 2:30 p.m. will not take place today,” it said in a statement. No reason was given for the delay nor was a new time frame provided.

The Hyundai Motor Co.–LG Energy plant in the southern U.S. state of Georgia is a cornerstone of America’s clean energy boom. But images of detainees shackled at the wrists, waist and ankles have fueled outrage in South Korea and rattled onlookers.

With some 300 people still detained, most of them on ESTA or B-1 visas that only permit limited business activity, others say they feel they too could easily have been rounded up.

“To see their employees treated like this, to the point of being banned from visiting the U.S. again, companies would feel humiliated and ashamed,” Chang Sang-sik, head of the Korea International Trade Association’s International Trade and Commerce Research Center, said. “Unless there are clear guarantees that workers won’t face such a situation, it will be even more difficult for companies to invest in the U.S. going forward.”

One person who previously traveled to the U.S. on the same short-term visa that landed the joint venture workers in trouble said it’s completely unrealistic for foreign firms like LG Energy to replace skilled South Korean staff with U.S. hires.

Such companies require large pools of talented, home-trained personnel who understand every detail of how a battery plant runs, the person said, asking not to be identified discussing sensitive matters. Once that infrastructure is in place, it then becomes easier for U.S. workers to operate the system, they said.

The person said as a consequence of what has happened over the past few days, they won’t risk a U.S. trip without the proper visa, even under company pressure, given the recent crackdown and their past travel history on ESTA.

South Korean firms are among the biggest investors in America’s automobile and battery supply chains, with firms from LG Energy to SK On Co. building some 22 cell and other manufacturing plants. The projects hinge on moving trained engineers quickly across international borders — something companies say is being undermined by visa bottlenecks and heightened immigration scrutiny.

Chang said operators in the high-tech sector usually send their best and brightest talent to the U.S. for projects to ensure that equipment is installed correctly and facilities can run seamlessly. If top engineers are treated this way, it will be difficult for companies to mobilize people in the future considering many employees will hesitate and their families would discourage them from going, even if it comes with a bit of extra pay, he said.

Without timely access to South Korean specialists, construction delays are likely, threatening billions of dollars of investment. That risks complicating Seoul’s bet on aligning with President Donald Trump’s “America First” revival, in which South Korea is pitching itself as a key partner in jobs, factories and clean-energy growth.

 

LG Energy, South Korea’s No. 1 battery maker, is building two other production lines in Arizona and Michigan, and a joint-venture factory in Ohio with Japanese automaker Honda Motor Co. Hundreds of Korean employees and contractors hired by LG Energy are setting up equipment and training other personnel at the sites, which are scheduled to begin operations next year.

While one person said some work is continuing at the construction sites, South Korea’s Kyunghyang newspaper reported the company has effectively ceased construction at LG Energy’s three other sites, and work at another joint plant in Georgia that’s being built by Hyundai and SK On is on hold as well.

SK On denied the report, saying construction at its Georgia site hasn’t been suspended. Representatives for Hyundai didn’t immediately comment.

A representative for LG-Honda venture said Wednesday there’s been no disruption at the plant site in Jeffersonville, Ohio, which has created some 2,000 construction jobs and is near completion.

“Our construction at L-H Battery is ongoing, and we are continuing with daily tasks,” Caroline Ramsey, a spokeswoman for L-H Battery Company, said in an email.

The incident comes just two weeks after South Korean President Lee Jae Myung and Trump held a summit to strengthen their two nations’ economic and security partnerships. The deal included a $350 billion fund to support South Korean firms expanding in the U.S., with $150 billion earmarked for shipbuilding. Private companies pledged an additional $150 billion in direct U.S. investment.

On Wednesday, a ruling party lawmaker in Seoul called for suspending all investment in the U.S. until the safety of Korean workers is guaranteed, saying that chaining workers in such a manner went far beyond acceptable norms.

President Lee will deliver a speech on Thursday to mark his first 100 days in office and is widely expected to address the issue, which has emerged as a major diplomatic challenge early in his presidency.

“I feel a great sense of responsibility,” Lee said at a cabinet meeting in Seoul on Tuesday, his first public remarks on the incident. “I hope there will never again be any unjust infringements on the activities of our citizens and businesses working for the joint development of South Korea and the U.S.”

Others are more measured about the ultimate impact on investment and ties between the two nations.

Bill Russo, the chief executive of Automobility and a former Chrysler executive, said while incidents like the recent raid will raise questions for foreign carmakers about the risks and complexity of operating in the U.S., “I don’t expect this to deter their long-term investment strategy.”

“The U.S. market is simply too large and too strategically important for Korean and Japanese manufacturers to step back. If anything, it may accelerate their efforts to tighten supply-chain compliance, ensure greater transparency with labor practices and demonstrate their commitment to being good corporate citizens.”

(With assistance from Shelly Banjo, Soo-Hyang Choi, Shinhye Kang, Nicholas Takahashi, Tsuyoshi Inajima, Linda Lew and Chester Dawson.)


©2025 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency, LLC.

 

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