Kia Motors Corp. jumped a whopping 14.5%, after a local media reported it Apple Inc. will invest 4 trillion won ($ 3.6 billion) as part of a partnership with the South Korean automaker to create electric vehicles.
The iPhone maker plans to set up production with Kia and build Apple cars in the Georgia, USA, automaker. DongA Ilbo reported without naming anyone. The companies may sign a deal on Feb. 17 and aim to introduce Apple cars by 2024, according to the paper, which said they have an initial goal of producing 100,000 cars per year.
A representative from the automaker in Seoul and an Apple representative in California declined to comment.
Reports that Apple is considering expanding into automobiles have sparked speculation about potential manufacturing partners. The tech giant’s car development work is still at an early stage, and the company will do it anyway half a decade to launch an autonomous EV, people with knowledge of the efforts have told Bloomberg News. That suggests the company is in no rush with partnership decisions.
Last month, Hyundai Motor Co., a subsidiary of Kia, withdrew from a statement saying it was in talks with Apple, revised it to say it had only been approached by potential partners for the development of autonomous EVs. The news pushed Hyundai’s shares up nearly 20% that day. Kia’s stock is now at its highest level since 1997.
An Apple electric car would compete with vehicles from Tesla Inc. and companies such as Lucid Motors and China’s upstart Nio Inc., as well as established manufacturers such as Daimler AG and Volkswagen AG. Setting up a car factory can cost billions of dollars and take years, probably why Apple is talking to potential partners.
Other tech companies looking to expand into automobiles have also sought partnerships. Taiwanese iPhone assembler Foxconn Technology Group said it did last month set up a company with a Chinese car manufacturer Zhejiang Geely Holding Group Co. to provide manufacturing and consulting services to global automotive enterprises.
– With help from Mark Gurman
(Updates with Kia’s response in third paragraph.)