To make the deal or not to make the deal.
Hyundai has a major decision to make, one that could change the automaker forever. Earlier this month, reports emerged claiming Hyundai and Apple were in talks to join forces to develop the long-awaited Apple car. The technology company has already sent Hyundai its proposal and it's now under evaluation. It's also possible Hyundai Motor Group could assign its Kia brand the Apple project. A final decision hasn't been made and according to Reuters, Hyundai executives remain divided over it. Not only did Apple refuse to comment on the report, but has not even acknowledged it was in talks with Hyundai to begin with. But the clock is ticking and Hyundai will have to make a choice.
"We are agonizing over how to do it, whether it is good to do it or not," said a Hyundai executive who's close to the discussions.
"We are not a company which manufactures cars for others. It is not like working with Apple would always produce great results." It certainly sounds like the deal would involve Hyundai or Kia manufacturing a vehicle designed by Apple. But Hyundai has a long history of keeping things in-house, from making its own engines and transmissions, final assembly, and even steel.
Adding even more pressure to executives is that ever since word of the talks got out, Hyundai and Kia shares have surged, a clear indication the market will respond kindly. It turns out, Hyundai and Apple first held talks about a partnership, called "Project Titan," back in 2018 but they soon fell apart because of the former's reluctance to work with outsiders.
"It is really difficult (for Hyundai) to open up," the source added. "Apple is the boss. They do their marketing, they do their products, they do their brand. Hyundai is also the boss. That does not really work."
Meanwhile, Apple's ideal agreement would it have it source major components they designed from several places and only require Hyundai or Kia for final assembly, if possible in the US. Still, there are broad areas of cooperation both companies could benefit from, such as Apple gaining access to Hyundai's electric car platform and related suppliers, and the automaker having access to Apple's autonomous vehicle stack and software.
Later this week, the Hyundai Ioniq 5 will officially debut and the pending deal with Apple will remain on everyone's minds.