- Some Hyundai executives fear partnering with Apple to make electric vehicles, Reuters reported.
- Hyundai confirmed in early January that it was in an “early stage” of negotiations with Apple over an electric car.
- “We are not a company that makes cars for third parties,” said an executive.
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Executives at South Korean automotive giant Hyundai are divided over whether the company should partner with Apple to make an electric vehicle, according to a Reuters report.
Hyundai acknowledged in early January that it was in “early stages” of discussions about making an electric car with Apple. But some executives fear becoming a contract manufacturer for the US tech giant, an executive familiar with the internal discussions told Reuters.
“We are not a company that makes cars for third parties,” they said. “It’s not like working with Apple would always produce great results.”
Apple uses contract manufacturers for other products: Foxconn, a Taiwanese company, makes its iPhones, for example.
South Korean media reported on January 10 that Hyundai and Apple planned to sign an agreement by March 2021, make a “beta” version of an Apple electric vehicle in 2022 and potentially start large-scale production in 2024.
Apple never acknowledged discussions with Hyundai and declined to comment to Reuters on the latest report.
Hyundai, which has extra production capacity, did not give an update on negotiations with Apple during a results conference call on Tuesday, in which it reported its best quarterly profit in three years. Insider asked Hyundai for comment.
People close to the discussions told Reuters that if a deal was struck, Hyundai or Kia – owned by the Hyundai Motor Co Group – would manufacture electric cars, which would be designed, sold and branded by Apple.
Kia, not Hyundai, could end up building cars
Another Hyundai executive told Reuters that “technology companies like Google and Apple want us to be like (contracted phone maker) Foxconn.
“Cooperation may initially help raise the image of the Hyundai or Kia brand. But in the medium to long term, we will only supply car bodies, and Apple would take care of the brains.”
Hyundai Motor Co Group “provisionally decided” that it would like Kia, not Hyundai, to partner with Apple if a deal goes ahead, a Hyundai source told Reuters.
He said: “The Group is concerned that the Hyundai brand will become just a contracted manufacturer from Apple, which would not help Hyundai in its effort to build a more premium image with its Genesis brand.”
The Genesis brand, which includes the recently launched Genesis G90 sedan, comprises Hyundai’s most luxurious cars.
Kia has extra manufacturing capacity at its plant in Georgia, United States, the source said.