Hyundai walks back confirmation it’s in talks over Apple car (updated)

Update 2/3: Apple invests 3.6 billion, partnering with Kia to build Apple Car in Georgia by 2024

Update 1/21: Kia confirms it is working with “third parties” on electric vehicles. While this is not a confirmation of working with Apple specifically, it does perpetuate the rumor mill on the potential “Apple Car.”

South Korean automaker Kia (a subsidiary of Hyundai) said on Wednesday it’s reviewing cooperation on self-driving electric cars with multiple foreign firms, making no direct mention of Apple.

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Previous Updates

Hyundai Motor Co. backed away from a statement confirming it is in talks with Apple Inc. on developing a self-driving car that fueled an US$8 billion surge in the Korean automaker’s market value Friday, saying instead that it received requests for potential cooperation from a number of companies.

Revising its statement for the second time in a matter of hours, Hyundai said it had been contacted by potential partners for the development of autonomous electric vehicles, removing any reference to Apple. Shares of Hyundai surged 19 percent after Korean media initially reported on talks with the U.S. company, only slightly paring their gains after the statement confirming discussions was revised.

Latest Rumor: Announcement by March

Apple Car and Hyundai

After a spokesperson for Hyundai last week confirmed that it is in talks with Apple regarding a potential Apple Car production deal. “We understand that Apple is in discussion with a variety of global automakers, including Hyundai Motor,” a company spokesperson said at the time. “As the discussion is at its early stage, nothing has been decided.”

Korea IT News says that Hyundai and Apple are aiming to reach a deal for autonomous electric cars by as early as March 2021. Production could then begin “as early as 2024 in the United States.” The report cites industry sources and says Apple and Hyundai would build the cars at the Kia Motors factor in Georgia, or “jointly invest in a new factory in the United States.”

Hyundai Stock Surges on News of Autonomous Car Development

Late last week Hyundai (HYMTF) released a statement disclosing it was in talks with Apple (AAPL) about the development of an autonomous car. The announcement led to an $8 billion spike in Hyundai’s market value, making an estimated $2 billion for the family behind the Korean auto company. The statement was first reported on Korea Economic Daily’s cable TV unit and noted that Hyundai was waiting on approval from the company’s chairman to begin the project with Apple.

After the report was televised, Hyundai released a statement saying it was one of a variety of carmakers Apple was considering for the partnership. Thirty minutes later, Hyundai revised the statement and removed the reference to other auto companies. Just hours after that revision, Hyundai also removed Apple from the statement, which then, in the end, read: “We’ve been receiving requests for potential cooperation from various companies regarding development of autonomous EVs. No decisions have been made as discussions are in early stages.”

Orginal Korean post is translated below

Apple is partnering with Hyundai Motor Group to launch an autonomous electric vehicle, the so-called Apple car.

As a result of an interview with Korea Economic Daily on the 8th, it was confirmed that Apple is in the process of negotiating and proposing cooperation with the Hyundai Motor Group to launch an Apple car. It is said that the review has already been completed inside the Hyundai Motor Group.

Apple is collaborating with Hyundai Motor Group not only to produce electric cars but also to develop batteries, the core of Apple cars. Apple and the Hyundai Motor Group are expected to promote battery development at either Hyundai Motors or Kia Motors’ US factories.

The launch of the Apple Car is targeted for 2027.

It is known that the Apple car will be equipped with its own battery technology, but it will also be developed with the Hyundai Motor Group. This is because of the enormous cost of technology and production facilities to produce the battery itself. Hyundai Motor Company also announced at last year’s CEO Investor Day that it will develop its own battery.

Apple’s battery type, technology, and future mass production plans have not yet been communicated. According to Reuters reports, Apple Car’s batteries will be designed to significantly lower costs and increase mileage.

Meanwhile, Apple has been conceiving automobile development for a long time. In 2014, a new autonomous vehicle division called Project Titan was established. In 2017, it was granted permission to drive on public roads to test autonomous vehicle technology from the California Transportation Authority (DMV).

While firing technologists gave up on Silicon Valley, analysts say the project regained momentum when Doug Field, who worked at Tesla, joined Apple in 2018.

McKinsey predicts that the share of electric vehicles in the entire automotive market will rise from 2.5% in 2019 to 30% in 2025. Every year, sales of the electric vehicle market are expected to grow by 22% on an annual average.

If the cooperation between Apple and Hyundai Motor Group, which is considered Tesla’s potential competitors, finally succeeds, it is expected that Hyundai Motor Group will quickly become the leader in the electric car market in terms of both productivity and technology.

What do you think? Here’s our thoughts

We believe this might have been an accidental early release by someone on the Hyundai side, and Apple wasn’t nearly ready for such an announcement, especially if we are 6 years out before availability.

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