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Hyundai Revises Statement of EV Cooperation with Apple, Hyundai Shares Up 20%

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by Benjamin Godfrey · 3 min read
Hyundai Revises Statement of EV Cooperation with Apple, Hyundai Shares Up 20%
Photo: Pixabay

With reports of Apple aiming at developing its own EV autonomous vehicles, the company will surely find a collaboration with Hyundai or any other established auto manufacturing firm.

South Korean multinational automotive manufacturer Hyundai Motor Co (KRX: 005380) has seen a massive $8 billion surge in its market value after the company said it is in talks with American technology giant Apple Inc (NASDAQ: AAPL) over the possibilities of helping to build its electric vehicles, a statement it revised shortly. Per a Bloomberg report, Hyundai motors revised its statement on the Apple collaboration twice with the final version noting that it had received requests from different companies to develop EV self-driving cars, removing its reference to Apple.

“We’ve been receiving requests for potential cooperation from various companies regarding development of autonomous EVs,” the latest version said. “No decisions have been made as discussions are in early stage.”

Following the initial statement issued, Hyundai stock soared and closed 19.42% to 246,000 Korean Won, the best daily gain the automotive company has seen since 1988 per the Bloomberg report. The shares of Hyundai subsidiaries were also pumped and these include Hyundai Wia added 21.33%, HYUNDAI MOBIS CO., LTD (KRX: 012330) gained 18.06% and Hyundai Glovis Co Ltd (KRX: 086280) was up 0.75%. Additionally, the shares of Hyundai affiliate Kia Motors Corporation (KRX: 000270), which is the second-largest automobile manufacturer in South Korea, surged 8.41%.

The initial claim of collaborating with Apple, if true, may frail relationships with the Cupertino-based firm as it has a zero-tolerance for leaked information regarding its unannounced proposed products as well as partnerships. According to a 2018 Bloomberg report, Apple warned its employees to refrain from leaking company-related information to the media, an act which the firm noted it has caught as many as 29 defaulters. The company subsequently raised the potential sanctions for future defaulters. In the case of Hyundai, the partnership is still in the dark and how this may be responded to by Apple remains unclear.

Besides Hyundai, Apple Will Still Need a Collaboration

With reports of Apple aiming at developing its own EV autonomous vehicles, the company will surely find a collaboration with Hyundai or other established auto manufacturing firms of a great boost to the proposed entry into the automobile industry. The cost of building a new car production plant is high and per Bloomberg News, it is a low margin investment and such moves may not be economical for the firm aiming to launch the vehicles by 2024.

“Apple needs to partner with a carmaker because it doesn’t have production capabilities and sales networks to sell its cars,” said Lee Han-Joon, an analyst at KTB Investment & Securities Co. in Seoul. “Building up those capabilities can’t be done quickly so Apple will need a partner for that.”

While noting the intricacies involved in manufacturing the autonomous EVs, there have been speculations that Apple may rather channel its energy toward developing car components and softwares for the automotive industry instead. The company can achieve this by riding on the wings of its current iPhone maker Foxconn Technology Co Ltd (TPE: 2354) who is also eyeing an entry into the EV space.

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Benjamin Godfrey

Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.

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