In the last couple of weeks, one had heard strong rumors about Apple being in talks with Hyundai for a partnership that would work towards developing the Apple Car, the first automobile vehicle produced by the global tech giant. While no formal agreement had been signed between Apple and Hyundai, a collaboration was said to be on the cards. Now, a new report provides some information on the kind of development and negotiations taking place between the two companies.
According to the report published in Reuters, instead of the companies inching closer to closing the deal, there are now chances that the two companies might not even come together for this project. The top executives at Hyundai, reportedly, aren’t sure if it would be a good idea for the company to tie-up with Apple to develop the vehicle. Hyundai is worried that instead of being an equal partner, it would end up being a contract manufacturer for the Cupertino based global giant.
Hyundai executives are not sure where this partnership will lead them towards and whether it will prove to be beneficial in the long run. Hyundai is not a company that undertakes manufacturing processes or works as a contract manufacturer for other companies. Hyundai produces vehicles for its own brand and right now, it is not sure if making a car for Apple would add any value to their company.
According to the Reuters report, Apple approached Hyundai in the year 2018 and spoke to them about the possibility of joining hands for this particular project. During this time, Apple’s ambitious car project was being supervised by Alexander Hitzinger. There is a chance that he was the one who suggested to the top brass at Apple that they should tie-up with a company that has good experience in the automobile business. Hitzinger currently works at Volkswagen.
It must be noted that Hyundai has excessive production capacity. Therefore, if it does become a ‘contract manufacturer’ to Apple, it would help in engaging its production units better and provide a boost to its production volume.
If reports are to be believed, Apple wants to buy major components like drive trains, frames etcetera from different places and then, get Hyundai to assemble everything together. Some other reports published in the recent past have suggested that if the partnership between the two companies does come into force, Kia’s Georgia plant could serve as the production base for the cars.
One first heard rumors of Apple being in negotiations with Hyundai earlier this year. Owing to the high costs involved in automobile technology and the difficulties associated with finding the right production facilities, Apple was hoping to partner with a company like Hyundai that has a lot of experience in this area. Apple wished to collaborate with Hyundai to manufacture electric vehicles and develop premium quality electric batteries.
Initially, Hyundai did confirm that it was in talks with Apple for the manufacturing of electric vehicles but later, it put out a revised statement which bore no acknowledgment of it being in talks with Apple. Apple, on its part, chose not to comment on this development.
“We understand that Apple is in discussion with a variety of global automakers, including Hyundai Motor.
As the discussion is at its early stage, nothing has been decided.”
— Steve Kopack (@SteveKopack) January 8, 2021
Reportedly, Apple and Hyundai wish to draw up a concrete partnership agreement for the Apple Car by the month of March. The recently released report suggests that things are not moving the way Apple would have wished to. Whether a partnership really happens between the two companies is something that remains to be seen.