Apple, Inc. And Kia Motors, Corp. Ink Deal To Drive Production Of Apple’s Electric Vehicle

NEWS: 02.05.21 – Get buckled up (and, fully charged up) because an Apple-branded autonomous automobile powered by electricity is almost ready to hit the streets.

A new report out Wednesday from Fox Business has revealed details of a $3.6 billion deal inked between Apple, Inc. and Kia Motors, Corp. in an agreement that will see the Korean automaker producing an Apple-branded autonomous automobile — specifically, an electric vehicle (EV) — for the iPhone maker. News of the newly-formed partnership between the two companies follows months of speculation that the end of the road was near for Apple’s self-driving car project and the Cupertino, California-based company was ramping up production on its so called “Apple Car” (as it has been dubbed by the media).

According to the report from Fox Business, per sources familiar with the deal, an official announcement regarding the Apple-Kia partnership is expected later this month (both the iPhone maker and Korean automaker declined to comment on the story).

Shifting Gears

Cited in the report from Fox Business was an earlier story published by Reuters from the week prior which revealed that Apple’s self-driving car project had been originally offered to Hyundai Motor, Co., According to the report, Hyundai — which revealed back in December of last year that it had been approached about building an electric vehicle designed by Apple — rather than be known as a contract manufacturer, in order to preserve its image as an independent automobile manufacturer? The Seoul, South Korea-based company decided instead to shift the project over to its subsidiary, Kia.

Shares of Kia Motors, Corp. reached their highest levels since 1997 following the news of the $3.6 billion deal inked between Apple and Kia

Based on information previously published in the Korean newspaper, Dong-a Ilbo, Fox Business reported that as part of the deal, Kia has agreed to build a U.S.-based automotive manufacturing plant — expected to be located in Georgia — where the “Apple Car” will be exclusively produced starting in 2024. The facility will produce the Cupertino, California-based company’s electric vehicle at a rate of 100,000 cars annually, with the capacity to ramp up production on the self-driving car to a 400,000 car-per-year rate.

Founded in 1944 with its origins manufacturing bicycles, Kia is Korea’s oldest automobile manufacturer and, since, has grown to become the world’s fifth largest. As a subsidiary of Hyundai Motor, Co., the Seoul, South Korea-based company (like Hyundai) is part of the larger Hyundai Motor Group. According to information on the company’s website, today, the Korean automaker produces more than 1.4 million vehicles a year.

Of the many styles of vehicles Kia manufactures and sells, one model is an electric vehicle of its own: the Niro EV.

Looking Into The Rearview Mirror

The news of an Apple-Hyundai partnership in its early stages was first reported by Reuters back in December of last year after details regarding preliminary discussions between the two companies over an electric vehicle and battery platform (e.g., Hyundai Motors E-GMP battery and EV platform) — presumably, for Apple’s self-driving car project — were made public locally by Korean media outlets. Prior to that report, the international news agency reported weeks earlier that Apple was actively working on autonomous automobile technology and was aiming to produce, as early as 2024, an electric vehicle with an innovative and breakthrough battery system. After the story broke, shares of Hyundai Motor, Co. were sent surging, a price surge of 24.8% which added nearly $8 billion to the Seoul, South Korea-based company’s market value.

At the time, Reuters noted in its report that it was still unclear who would assemble an Apple-branded autonomous automobile but analysts have said that they expect the Cupertino, California-based company to rely on a manufacturing partner within the automotive industry for its production.

This past January, in a report from Business Insider with regard to an Apple executive stepping down to take on a new project — and speculation over what it might have entailed, such as Apple’s self-driving car project — the news outlet noted that the announcement from the Cupertino, California-based company regarding its former hardware engineering chief came amid the reports of the company’s talks with Hyundai as originally reported by Reuters in December. As part of Business Insider’s report, cited in the story were experts who speculated that among the top contenders within the automotive industry most likely to build the “Apple Car” were German automaker Volkswagen and Fremont, California-based Tesla, Inc.

In its report back in December of last year, Reuters noted that an electric vehicle designed by Apple could pose a big threat to Tesla, since the Fremont, California-based company is a leader in the electric vehicles (EVs) market.

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Playing With Cars

Last year, Business Insider — in a feature published in the pages of Inc. magazine on everything known to date about the “Apple Car” (specifically, with regard to Apple’s self-driving car project) — reported that the Cupertino, California-based company was working on something that will, according to an Apple employee who privately reached out to the news outlet, “…give Tesla a run for its money.”

In the report was the clearest evidence yet that Apple was working on autonomous automobile technology, with Business Insider citing a credible report from February of last year originally published in the Wall Street Journal that made reference to the codename for Apple’s self-driving car project… “Project Titan” (presumably, the “Apple Car”). Based on information from a source with knowledge of the project, the WSJ reported that the Cupertino, California-based company had hundreds of people working on an electric vehicle: the prototype reportedly resembled a minivan (see author’s note at end of article). The project is said to be headed up by Steve Zadesky, a veteran of Ford Motor Company who helped build the first Apple-branded MP3 music player back in 2001 (the iPod).

The very same week that the WSJ story broke came a separate, but, related report in the Financial Times which revealed that Zadesky, the Ford veteran turned Apple employee, had apparently been making trips across the globe, specifically, to Austria, to find a manufacturing partner to build an Apple-branded autonomous automobile. Per the Business Insider report, a source told the FT that, “…three months ago, I would have said it was CarPlay. Today? I think it’s: a car.”

At the time, Business Insider reported that the “Apple Car” is believed to still be years away.

Business Insider noted in its report that an Apple-branded autonomous automobile would be the most ambitious foray into a new product category for Apple, Inc. since 2007 when an Apple-branded smartphone (the iPhone) was launched. On the notion of the Cupertino, California-based company entering a new product category (the last was actually in 2014 when an Apple-branded smartwatch was introduced: the Apple Watch), in a report this past January from Bloomberg unrelated to Apple’s self-driving car project, the news outlet broke the story that an Apple-branded VR headset — a device reported to be a precursor to a pair of Apple-branded AR smart glasses (dubbed by the media as, “Apple Glass“) — is scheduled to launch sometime next year in 2022… two years before a car designed by Apple is expected to come into play.

A Note from the Author: for a digitally rendered 3-D concept of the “Apple Car” prototype mentioned in this article, see photograph from report on the Apple-Hyundai partnership published in January of this year in Car and Driver magazine.