(Bloomberg) – Speculation that Apple Inc. Looking for a partner to develop its own electric car, it toured South Korea and Japan, where the shares of major car manufacturers climbed following reports of discussions with the maker of the iPhone.
Kia Motors Corp. talk to potential partners about a plan to assemble an Apple-designed car, the Wall Street Journal reported Friday. Separately, the Nikkei newspaper said Apple was in talks with at least six car makers. Guesses about Apple’s secretive project to design and sell its own car got back on track in December after a hiatus of several years, with Kia’s co-owner Hyundai Motor Co. was mentioned as a potential partner.
The key question is how seriously Apple is taking on Tesla Inc. and other electric vehicle manufacturers, and whether it has determined that it needs an established manufacturer to roll out its own product. The Cupertino, California-based company would have a small team of engineers developing powertrain systems, as well as designers, but with early stage development work, a rollout is unlikely to take place for five years.
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Tatsuo Yoshida, a senior analyst with Bloomberg Intelligence, said Japanese automakers are usually too busy with their own development, production, sales, and customer service to take on a task such as working with Apple. Nissan Motor Co. or Mitsubishi Motors Corp. “However, they don’t have much work and are somewhat inactive, so they can apply,” he said.
When asked if they were approached, Honda Motor Co. and Mazda Motor Corp. they could not comment, the Nikkei said. Mitsubishi Motors said it was not contacted and Nissan declined to comment, the report said. The chief financial officer of Subaru Corp. said during an earnings call that he had not heard about an Apple car.
Kia shares rose 1.5% in Seoul, adding to gains from earlier this week in a local media report that Apple would invest 4 trillion won ($ 3.6 billion) as part of a partnership with the automaker at the making electric cars. In December, Hyundai withdrew from a statement saying it was in talks with Apple.
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The Journal reported that a deal between Apple and Kia will entail a multi-billion dollar investment and that assembly will take place in the state of Georgia. This week, CNBC reported that Apple is about to sign a deal with Hyundai-Kia to build an autonomous electric car at Kia’s US plant. No agreement has been reached, but preliminary planning is for them to go into production in 2024, the news channel said.
A Kia representative declined to comment.
Hyundai has developed a new EV platform and plans to build 23 electric vehicles, starting with the Ioniq 5 in Europe in March, followed by a Kia model later this year. EVs created on the platform can be charged to 80% in 18 minutes and add up to 100 kilometers (62 miles) of driving range in just five minutes. They have a top range of 500 kilometers on a single charge. Hyundai aims to sell 1 million cars by 2025.
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In Japan, the report drove gains for automakers, which in turn boosted the benchmark Topix, with Toyota Motor Corp., Mitsubishi Motors and Nissan. Mazda’s share also rose 19%, the highest rate in 12 years, after the company increased projected revenue for the full year.
Among the Japanese automakers, Nissan probably has the right solution for a non-automaker looking to enter the EV market. The Japanese carmaker, together with French partner Renault SA, has developed a common EV platform that can be used to develop various branded products for their global carmaker, which includes Mitsubishi Motors.
Nidec Corp., a major Japanese electric motor supplier, also aims to offer nearly complete EV platforms. Jun Seki, the company’s chief operating officer, said in a recent interview that newcomers to the industry prefer to focus on a vehicle’s interior and styling.
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“Any new company entering the electric vehicle world is an opportunity for us,” said Seki. “Our expectations from Apple are quite high. Apple is our important customer in other areas as well. “
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