It was speculated in early January that Hyundai Motor Co. was in discussions with the iPhone behemoth about an electric car and battery joint venture. Apple is said to be targeting 2024 to produce a self-driving car that could include its own battery technology.
Last week, a report from South Korea's online news outlet DongA.com said Kia Motors, an affiliate of Hyundai, was on the verge of signing a 4 trillion won (US$3.59 billion) deal with Apple to build electric vehicles. It was suggested a deal would be signed on February 17.
However, both Hyundai Motor Co. and Kia are said to have issued statements saying they are not having talks with Apple on developing autonomous vehicles.
According to Reuters, the news wiped $3 billion off Hyundai Motor Co.'s market value while Kia took a $5.5 billion hit. CNBC said other affiliates including Hyundai Wia, Hyundai Mobis and Hyundai Glovis also fell sharply.
Talks could restart
The talks certainly appeared to have entered rough terrain. In January, it was reported that Hyundai may have incurred the wrath of the famously secretive Apple by jumping the gun on announcing talks.
The car maker revised its first statement in a matter of hours, removing any reference to Apple and saying only that it had been contacted by potential partners for the development of autonomous electric vehicles. However, the damage may already have been done.
The carmaker has also been apparently agonizing over whether or not it should build cars for someone else. Reuters said Hyundai is traditionally known for its reluctance to work with outsiders, making engines, transmissions and its own steel in-house in a vertically integrated supply chain.
Sung Yop Chung, regional head of automobiles and components at Daiwa Capital Markets, told CNBC that it was still possible for both sides to revisit the deal at a later date as Hyundai said in its regulatory filing it was in talks with multiple companies.
"I wouldn't say that this is the end of it, I would say it's a temporary halt if you like for the negotiation between the two groups," he told the news outlet.
Apple has of course kept quiet about its plans so far. According to a December report from Reuters, Apple's automotive gamble under Project Titan had started to gain traction after years of uncertainty about the project's future.
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— Anne Morris, contributing editor, special to Light Reading