Following rumors over the last few weeks that Apple and Hyundai are in talks to develop an “Apple Car,” comes a new Reuters report providing more details about whether the deal might come to fruition.
The report says the outlook for the deal is less than optimal, as Hyundai executives are divided over the prospect of working with Apple. The sticking point for many of the executives is that Hyundai would basically become a contract manufacturer for another brand, something they are not comfortable with.
“We are agonizing over how to do it, whether it is good to do it or not,” said a Hyundai executive aware of the internal discussions on the tie-up with Apple. “We are not a company which manufactures cars for others. It is not like working with Apple would always produce great results.”
The report indicates the Apple and Hyundai talks kicked off back in 2018. Now, the talks are in danger of stalling, due to Hyundai’s traditional reluctance to work with other companies.
“It is really difficult (for Hyundai) to open up,” this person said, adding that the South Korean company would likely to have to replace some executives to avoid a culture clash under any partnership with Apple.
“Apple is the boss. They do their marketing, they do their products, they do their brand. Hyundai is also the boss. That does not really work,” the person said.
Hyundai reportedly has excess manufacturing capacity and contract manufacturing for Apple would help it increase production volume.
A January 19 report indicated Apple Car production would be handled by Hyundai’s Kia brand, at its U.S. factory in Georgia. Apple would design the components used and they would be sourced from a variety of sources.
A January 8 report claimed Apple and Hyundai are in talks to work together in building the Cupertino firm’s Apple Car. The report indicated that Apple is in negotiations with the Korean carmaker to not only manufacture an electric car but to also develop batteries, due to the “enormous costs” of the technology and the production facilities required.
While Hyundai initially confirmed the discussions in a statement to CNBC, but revised the statement shortly after to include no mention of Apple.
Conflicting reports have been released over the last month or so, with Reuters claiming Apple Car production could kickoff around 2024, soon followed by a Bloomberg report that the Apple Car won’t be ready for production for another five to seven years.