Hyundai 'agonising' over potential tie-up with Apple 

Few details are known about the discussions but insiders say  options considered included Hyundai or Kia acting as a manufacturer for vehicles designed by Apple and sold under its brand

Tim Cooks's Apple has never acknowledged talks with the carmaker about building vehicles.

Executives at Hyundai are divided over a potential tie-up with Apple, with some raising concerns about becoming a contract manufacturer for the US tech giant, dimming the outlook for a deal.

Hyundai said earlier this month it was in preliminary talks with Apple, but gave no details. Local media said the firms were discussing an electric car and battery tie-up, while both companies declined to comment. 

Tim Cooks's Apple has never acknowledged talks with the carmaker about building vehicles, and it was unclear whether any such talks are still active. The iPhone maker typically insists on strict secrecy from its potential partners and suppliers about future plans or unreleased products.

In an earnings call earlier this week, in which it reported its best quarterly profit in more than three years, Hyundai did not give any updates on talks with Apple or indicate whether they remain active.

“We are agonising over how to do it, whether it is good to do it or not,” said a Hyundai executive aware of the internal discussions on the tie-up with Apple. 

We are not a company which manufactures cars for others. It is not like working with Apple would always produce great results.” 

Few details are known about the talks between the two companies. But people close to the discussions say the options considered included Hyundai or Kia acting as a manufacturer for vehicles designed by Apple and sold under its powerful, ubiquitous brand.

Hyundai is traditionally known for its reluctance to work with outsiders, making engines, transmissions, and even its own steel in-house under its vertically integrated supply chain as South Korea’s second-largest conglomerate. 

Although shares in Kia and Hyundai have surged because of the talks, there is considerable opposition to becoming an Apple contract manufacturer, which could hold up any deal with the American giant, these sources said.

Apple and Hyundai first started talks over a car partnership in 2018, when Apple’s effort, known as “Project Titan,” was headed by Alexander Hitzinger, who is now a Volkswagen executive, said a person familiar with the matter. But progress was hampered by the South Korean automaker’s reluctance to work with outsiders, the person said.

“It is really difficult [for Hyundai] to open up,” this person said, adding that the South Korean company would likely to have to replace some executives to avoid a culture clash under any partnership with Apple. 

• Bloomberg