Following reports that the two South Korean automakers were just days away from shaking hands with Apple over autonomous vehicle development, Hyundai and Kia have pulled the plug on the potential partnership.
Just a month after talks began with the Californian tech powerhouse, both Hyundai and Kia have seen shares tumble in reaction to the announcement, wiping a substantial $8.5 billion off the valuation between the two. More specifically, Hyundai’s stock fell by 6.2% and Kia’s by 15%.
“We are receiving requests for cooperation in joint development of autonomous electric vehicles from various companies, but they are at early stage and nothing has been decided,” the Hyundai Motor Group said in an update to investors on February 8th. “We are not having talks with Apple on developing autonomous vehicles.”
According to media reports in South Korea, the deal was in touching distance, with a predicted completion date as soon as February 17th. Included in these reports are predictions that talks collapsed after Apple made it clear to Hyundai that it would operate solely as an equipment manufacturer, rather than a strategic partner. The South Korean automaker is adamant that it will not just play the role of a supplier or manufacturer in the proposed deal.
Historically, Hyundai has taken a firm stance when working with external companies. Today, it produces engines, transmissions and steel frames within its own vertically-integrated supply chain, making it the country’s second-largest conglomerate.
As for Apple, the company is still aiming to bring-to-market an autonomous passenger vehicle with its own battery technology by 2024. However, it may have to look further for a new automotive partner.