Hyundai, Kia Retract Their Deal With Apple, Their Combined Stock Tumbles Over 21 Percent

Hyundai Motor Co, which once verified the contract they had with Apple to build its first autonomous electric vehicle last month, has now revealed on Monday that they are not in business with the American tech giant. The recent update from South Korea’s automobile company has also affected their shares.

According to the South Korean company’s financial data, Hyundai stocks dropped by 6.2%, equivalent to $3 billion of its market value. While Kia Corp, it subsidiary vehicle manufacturer that is supposed to handle the iPhone maker’s electric car project, also experienced a $5.5 billion drop of its stocks valued at 15%.

Hyundai’s report revealed the in-house disagreement between the executives handling the operations of both the parent company and its subsidiary company — they are concerned about being a mere contract manufacturer for the renowned iPhone maker. Apple’s business proposal resulted in the traffic in sealing the deal with the South Koreans.

According to Hyundai’s executive spokesman, he said: “We are agonising over how to do it, whether it is good to do it or not. We are not a company which manufactures cars for others.”

Remember Foxconn, the Taiwanese multinational electronics contract manufacturer responsible for producing Apple’s gadgets, iPhone — the South Korean automaker declined to contract business in a significant deal that will yield billions of outcomes.

“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 South Korean automaker said. “We are not having talks with Apple on developing autonomous vehicles.”

Adherence to the stock market policy that requires a regular update to investors, Hyundai had to clear the air.

When the South Korean automaker Hyundai dropped the notice that verified their partnership with Apple to build self-driven electric vehicles by 2027, Kia shares experienced a rapid increase by 61% at the beginning of January.

Hyundai motors were also supposed to develop batteries that support the proposed vehicle in Apple’s factories stationed in America but operated by the South Koreans.

Initially, the South Korean automaker said: “Apple and Hyundai are in discussion, but as it is at early stage, nothing has been decided,” until they recently retract their initial announcement to consort the American tech giant.

However, Hyundai is still yet to accept the series of requests they have received to develop electric vehicles, but they did not disclose the issuer’s identity.

Conforming to report from media houses such as CNBC and other Asian reporters, they said that the South Korean automaker was about to finalize its deal with Apple. In contrast, others suggested Feb 17th as the date to commence production of self-driven electric vehicles.

Despite the relationship between the Americans and the Asians that is unbalanced, Hyundai is typically renowned for its nonchalance in partnering with foreigners. Although, both Apple and Hyundai are known to be vertically integrated with business dealings.

The Asian automaker is more concerned about preserving their reputation than impacting the automobile industry status quo.