NEWS: 02.15.21 – Apple’s development of an autonomous electric vehicle (EV) has driven itself into the proverbial mud.
Kia Motors, Corp. — part of the Hyundai Motor Group (and, a subsidiary of the Hyundai Motor, Co.) — has revealed via a new regulatory filing that it currently is, “not in talks” with Apple, Inc. to manufacture an autonomous electric vehicle for the Cupertino, California-based company. The news, as reported last Monday by CNBC, came after a previously published report by the news outlet from the week before that the Seoul, South Korea-based company was close to finalizing a deal to assemble an Apple-branded EV (a.k.a., the “Apple Car”) at the Kia automotive manufacturing plant in West Point, Georgia.
CNBC’s report focused on the fact that shares of Kia — which is the second largest automobile manufacturer in Korea behind Hyundai (and the world’s fifth largest according to Kia’s website) — plunged about 15% while Hyundai’s own shares fell 6.21% following the news of the stall in talks and possible dissolving of the deal with Apple.
A ‘U-Turn’ Of Events
This past January, Hyundai (as previously reported by CNBC) initially said that it was in early stage talks with Apple to develop an autonomous electric vehicle, but, shortly thereafter, the Korean automaker backtracked and made no mention of the iPhone maker or any details with regard to discussions between the two companies in a revised statement issued later that month.
More recently, according to a regulatory filing made by Kia — as seen by CNBC and translated into English for publication in its report on Monday of last week — the automobile manufacturer said that it was reviewing the prospects of, “cooperating with multiple companies” overseas over autonomous electric vehicles but no decisions had yet been made. Most notable in the filing was that the Seoul, South Korea-based company said that it was, “not in talks with Apple” regarding such (contradicting details previously reported earlier this month by various media outlets).
Kia’s parent company, Hyundai, also made a similar regulatory filing of its own (which, too, was translated by CNBC in its report).
In the filing, Hyundai said that it was getting, “requests from multiple companies for cooperation in joint development” of autonomous electric vehicles but that nothing had been decided yet, “since it’s in early stage” according to the automobile manufacturer. The other Seoul, South Korea-based company also noted — as was done by its subsidiary, Kia — that it was not in talks with Apple over the development of a self-driving car.
Caution: Speed Bump Ahead
With regard to the Kia deal to build an Apple-branded EV, Business Insider reported last Monday — describing it as hitting, “a major speed bump” in the road — that the talks were put on hold because both automobile manufacturers had, “blabbed to the press” (as quoted verbatim from the report), disclosing details of the agreement between the iPhone maker and the two Korean automakers (information which has yet to be officially made public). Additionally, according to the news outlet, Hyundai’s executives were reportedly divided over whether it was a good idea to make an autonomous electric vehicle for another company like Apple (as the Seoul, South Korea-based company did not want a reputation as a contract manufacturer and tarnish its role as an independent automaker).
The news of talks being put on hold came following a report cited by Business Insider that was originally published in the Wall Street Journal from just days earlier that Kia was searching for production partners to help build an autonomous electric vehicle for Apple at its automotive manufacturing plant in Georgia.
Business Insider reported that no comments have been made publicly to-date with regard to Apple’s self-driving car project — known internally within the Cupertino, California-based company by its codename: “Project Titan” (the “Apple Car” from its inception) — which has reportedly been in the works since 2014. According to the news outlet, Apple was not immediately available for comment on their report (when specifically contacted for that purpose).
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Screeching To A Halt
In a report published just days before the news of Kia’s regulatory filing, Bloomberg reported — based on sources with knowledge of the situation (who asked not to be identified as they were disclosing confidential information) — that, while the Cupertino, California-based company also has been discussing similar plans with other automobile manufacturers, the iPhone maker had indeed been actively talking with both Korean automakers to discuss the development of an Apple-branded EV, however, those talks have been recently paused (and, since that time, have been halted). Should the discussions resume, a potential monkey wrench in the deal, based on a source familiar with the matter who spoke to the news outlet, is an internal dispute within the Hyundai Motor Group over which of its two brands would be assigned to work on Apple’s self-driving car project. Kia, per the source, is seen as the most likely front runner to build an autonomous electric vehicle for Apple at its automotive manufacturing plant in Georgia (corroborating the reports from CNBC and Business Insider).
Aside from the leaks disclosing specific details of Apple’s self-driving car project that have been reported by the media, according to Bloomberg, it was Hyundai’s own announcement in December of last year with regard to its early talks with Apple that apparently angered the Cupertino, California-based company, which, per the news outlet, has been known to control relationships among its suppliers with, “ruthless efficiency” (as quoted verbatim from the report), shrouding in secrecy its projects in development (e.g., “Project Titan”),, and keeping under wraps for many years details regarding such before officially being disclosed to the general public.
On “Project Titan” itself, Bloomberg reported that while work on Apple’s self-driving car project has been ramping up in recent months, with a small team of designers and engineers developing drive systems for an autonomous electric vehicle? The actual car is currently at an early stage of development and its rollout is still likely to be five years away. The news outlet suggested that this would essentially give the Cupertino, California-based company more time to decide on who within the automobile industry to potentially partner up with for an Apple-branded EV.
However, as noted by Bloomberg, there are only a handful of global automobile manufacturers with the capacity — and, capability — to mass produce electric vehicles (EVs), and it is unclear how many of these automotive companies would be interested in collaborating on such a project with Apple. Additionally, according to the news outlet, it is also unclear whether talks between the iPhone maker and the two Korean automakers will resume (and, if so, when?).