Rumors that Apple is in negotiations with Hyundai about developing an Apple Car have been in the air over the last few weeks, and a new
Reuters report today provides further details on the state of play between the two companies.
According to the report, the outlook for a deal has dimmed because Hyundai executives are divided over the prospect of working with Apple. Hyundai's main concern is that it could become a contract manufacturer for another brand.
According to the report, Apple and Hyundai first started talks over a car partnership in 2018, when Apple's car project was headed by Alexander Hitzinger, who now works for Volkswagen. However, progress in the talks has been hampered by Hyundai's historical reluctance to work with other companies.
Despite its reluctance, Hyundai is said to have excess capacity, therefore contract manufacturing would help it secure production volume.
Apple reportedly wants to source major components of its own design – frames, bodies, drive trains, and other parts – from a variety of places and rely on Hyundai or Kia, a Hyundai Motor Group affiliate, for a final assembly site.
Previous reports also suggested that Kia's Georgia plant in the U.S. could become the production base, which would suit Apple better.
Rumors that Apple is in negotiations with Hyundai first surfaced
earlier this month, suggesting that Apple is planning to work with the automaker to produce electric vehicles and develop batteries due to the high costs of the technology and the necessary production facilities.
Hyundai initially
confirmed its electric vehicle discussions with Apple in a statement to CNBC, but the statement was
revised hours later with no mention of Apple. Apple has not commented on reports of the negotiations.
Reuters last month
reported that Apple Car production may begin around 2024. However, a report from
Bloomberg last week said that the Apple Car is "nowhere near production stage" and could be ready in around five to seven years.
Apple and Hyundai reportedly want to reach a partnership agreement for the upcoming Apple Car by
March, although today's report seems to cast doubt on any deal being signed off anytime soon.
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Hyundai Executives Said to Be 'Divided' Over Prospect of Apple Car Partnership