An immigration raid on a significant electric vehicle (EV) battery plant under construction in Georgia, a joint venture between South Korean giants Hyundai Motor Co. and LG Energy Solution Ltd., has triggered a diplomatic uproar in Seoul. This event occurred less than two weeks after South Korean President Lee Jae Myung's White House meeting with Donald Trump, during which Korean companies pledged substantial investments amounting to hundreds of billions of dollars in the United States.

Korean officials worked intensely over the weekend following the raid to secure the release of approximately 300 of their citizens who were detained at the construction site. The exact visa status of the workers and whether those visas permitted their presence at the site remain unclear. South Korea has announced plans to dispatch a chartered plane to repatriate its citizens once administrative procedures are finalized.

The timing of this crackdown is particularly sensitive, immediately following a high-profile summit between President Lee and Trump aimed at reinforcing their alliance and finalizing a new trade pact. This deal included a $350 billion fund to support South Korean firms expanding their operations in the U.S., with a significant $150 billion designated for shipbuilding. Private companies further committed an additional $150 billion in direct US investment. The raid has consequently placed President Lee's government under immense domestic pressure and threatens to escalate into a major diplomatic incident with one of Washington's closest allies.

The incident garnered extensive front-page coverage in South Korea's daily newspapers, with distressing footage depicting workers shackled at their wrists, waists, and ankles as they were escorted onto buses, fueling widespread public outrage. Chosun Ilbo, South Korea’s most widely circulated newspaper, published a photograph of detainees pressing their hands against a bus window and images, purportedly from the Georgia detention facilities, describing them as notoriously "covered in mold, worse than prisons." Kim Tae-Hyung, a professor at Soongsil University, articulated the sentiment, stating, "It feels like a stab in the back... Most Koreans can’t help but feel infuriated," predicting that Korean companies would "inevitably" be deterred from proceeding with their planned US investments.

This immigration enforcement action now casts a considerable shadow over South Korea’s multibillion-dollar investment drive in the US. The detention of workers associated with a flagship Korean investment project could be perceived by companies as an indication of higher-than-anticipated political and compliance risks involved in establishing operations in the United States. The Maeil Business Newspaper captured this sentiment with a cartoon illustrating Trump wielding a club, juxtaposed with a figure delivering money for US factories, only to appear bewildered as numerous Korean employees on US business trips are detained.

The Georgia plant itself was conceived as a tangible symbol of Seoul’s commitment to bolstering US manufacturing capabilities. Chang Sang-sik, head of the Korea International Trade Association’s International Trade and Commerce Research Center, cautioned that Korean businesses will encounter increased difficulties in constructing new facilities or operating within the US if American authorities continue to enforce stringent immigration laws without addressing persistent visa challenges. Local media reports indicate that many Korean companies frequently resort to the ESTA visa waiver program, designed for short-term business trips of up to 90 days, when urgent employee dispatches are required. Chang emphasized the dilemma: "The US is demanding investments from South Korea but is asking us to use Americans only to construct factories there. In reality, that is just impossible. They need local technicians during the construction period."

US officials characterized the operation as the Homeland Security Department’s largest single-site enforcement action, resulting in the detention of 475 workers in total. While US authorities maintained that the raid was the culmination of a months-long investigation into illegal hiring practices and was not politically motivated, the broader implications and optics are undeniable. This incident highlights a conflict between a core tenet of the Trump administration’s policy of aggressive immigration enforcement and its other significant priority: attracting foreign investment and manufacturing back to American shores.

South Korea stands as the US’s sixth-largest trading partner, with its companies playing an indispensable role in the global EV battery supply chain. Their investments in US factories were actively encouraged by Washington to lessen dependence on China. A crackdown that ensnares such crucial projects risks significantly complicating established trading relations. The raid has already triggered immediate consequences: construction at the Georgia plant has been temporarily halted, a pause that could have cascading effects on the timeline for Hyundai’s broader EV production plans in the US. The Georgia industrial site is projected to produce up to 500,000 hybrid and electric vehicles annually and employ as many as 12,500 workers by the early next decade.

This is not the first instance of Hyundai, a prominent foreign investor in US manufacturing, facing legal issues related to employment in the US. In 2022, the US Labor Department identified child labor violations at companies supplying the Korean automaker in Alabama. Regarding the current situation in Georgia, Hyundai has stated that it is closely monitoring the situation and working to understand the specific circumstances, asserting that none of its direct employees were among those detained. LG Energy, however, confirmed that 47 of its employees were among those held – 46 from South Korea and one Indonesian – and has since suspended business travel for its employees to the US, advising staff already there to return home. Reports further suggest that many other South Koreans detained were subcontractors.