Hyundai bosses 'agonizing' over whether to build 'Apple Car'

245

Comments

  • Reply 21 of 82
    lkrupp said:
    As long as it’s manufactured to Apple’s specifications and not just another Hyundai chassis with Apple’s logo and software on it I’m okay. It must be assembled in the U.S. and preferably with UAW plants and workers. That’s the only way, in my opinion, it could succeed with the general public.

    Also interesting is that GM has announced they will be all electric by 2035.
    1.  It won't be a badge-engineered Hyundai/Kia.  Apple is looking for a contract manufacturer like Foxconn, but for cars.  "Apple reportedly wants to source major components of its own design – frames, bodies, drive trains, and other parts – from a variety of places and rely on Hyundai or Kia, a Hyundai Motor Group affiliate, for a final assembly site." - MacRumors
    2.  It's already known that (if the deal is finalized) it would be assembled in the US in the Kia plant in Westpoint, GA.
    3.  The Kia plant is non-UAW.  The south isn't that pro-union.  It's one of the reasons foreign based automotive companies like to set up shop below the Mason-Dixon. 
    thth2p
  • Reply 22 of 82
    dk49dk49 Posts: 228member
    GG1 said:
    dk49 said:
    dk49 said:
    If Hyundai decides to Ditch Apple, and Apple doesn't find another car manufacturer ready to assemble their cars, it will become really tough for Apple. They will have to build their own factories which will further delay the project. Though I wonder why Magna didn't say yes to it. They are basically the Foxconn for car manufacturers. And I am sure Apple must have approached them earlier.
    Like you, I think Apple contacted Magna early in the process.  Probably one of the first companies Apple contacted.  I think 2 things made Magna an unacceptable partner. 
    1. Location - I really think Apple desires a US assembly location.  The infrastructure for manufacturing and assembling their general tech (phones, computers, tablets, etc) is concentrated in Asia.  That's not the case for cars, and assembly in the US could even be cheaper.   Magna has no N. American plants.  It's rumored (again) they're looking to open a N. American plant, but that rumor has surfaced many times over the past couple of decades.
    2. Capacity - I've no doubt Magna could handle Apple's initial assembly and volume.  Apple's thinking long term.  Scale and capacity would be Magna's issue.  Magna doesn't have an advantage in ether of those factors that could compete with Hyundai's capacity.  Hyundai/Kia has the ability scale their production to meet any capacity Apple may need.  Magna doesn't have that ability.  They already contract manufacture Jaguar's I-Pace and E-Pace, Toyota's Supra, BMW's 5-Series and Z4, and MB's G-Class.  

    When this story initially broke, I said Apple was looking for an OEM/contract manufacturer, not a brand partner.  Some people are still incorrectly looking at this from a brand partner perspective.  Not really sure why.  Questions like, "why Hyundai and not BMW, MB, Porsche, or [insert luxury brand here]" still abound.  None of those brands would ever consider being an OEM manufacturer.  They would have the same concerns that Hyundai is expressing about brand erosion, 'cept their concerns would be magnified because their brands are waaaaaaay more valuable and influential than Hyundai's.  That's not a knock on Hyundai.  That's just reality.
    I agree with you on the aspect of finding a manufacturing partner. I had mentioned the same thing when people were like "Hyundai sucks. Why not BMW?". If Apple has to build its own factories, it's going to make this project much more complex and time consuming, and delay it by a few more years. 
    Though Apple might indirectly partner with Magna in a way they did with Sharp for manufacturing LCD displays. They can pump in half of the money (or more) in Magna required to make a N. American plant. A financial push from Apple, combined with the long term benefits might be enough for Magna to start building a plant in N. America.
    I agree that a US location is key, and maybe Magna could be persuaded to build in the US. And Hyundai/Kia seem to have their hands full with the popularity of their cars now (new Sonata, Palisade, etc.), so they may not have the capacity. And the quote from the Hyundai exec tells me it won't happen. Both want total control. Hyundai are not a contract manufacturer.

    So I wonder if Apple may buy or partner with an EV company such as Lucid or Rivian. IMO both companies have taken the time to develop their vehicles and have not made splashy marketing/tweet claims. In other words, a similar behavior to how Apple operate (and total opposite to Nikola and Musk's tweets). And both are located in the US.

    >>>>>>>>>

    I don't think Apple will ever co-brand their cars. It would want a complete Apple branded car. Lucid or other similar manufacturers might not agree to it. And Lucid did made quite a lot of buzz when it introduced its cars, so it's not short on marketing. Only way Apple and Lucid could combine is if Apple baught Lucid. 

    edited January 2021 watto_cobra
  • Reply 23 of 82
    Yeah, I think you all are right that it would probably be a company that can manufacture in NA or it would be really hard to ship. If that was not the case, then I could see them go with a Chinese EV company like Byton. I have see their prototypes at CES for the last 3 year (except this year of course which was virtual) and they looked pretty neat.
  • Reply 24 of 82
    22july201322july2013 Posts: 3,178member
    No auto manufacturer wants to be the next Foxconn; they all value their interface with the consumer. Their motive is understandable, but it reminds me exactly of newspapers who don't want Apple's money in exchange for losing their direct connection with the consumer. The problem they all face is that some consumers don't want to interface with the company they buy products from. For example, I'm sick of getting emails from Honda. I feel that Honda doesn't respect me. I'm tempted to avoid Honda on my next car purchase just because of their invasion of my privacy. I truly believe that companies like Honda and NYT would rather lose business than lose their connections with their consumers. And that's their legal right. I defend their right to do bad business and fail.
    randominternetpersonwatto_cobra
  • Reply 25 of 82
    lkrupp said:
    As long as it’s manufactured to Apple’s specifications and not just another Hyundai chassis with Apple’s logo and software on it I’m okay. It must be assembled in the U.S. and preferably with UAW plants and workers. That’s the only way, in my opinion, it could succeed with the general public.

    Also interesting is that GM has announced they will be all electric by 2035.
    Maybe the "general public" would care whether an Apple car is made in the US (although, I'm not certain of that), but the UAW thing is a non-issue.  There are die-hard Union Yes! people who would care and try to make an issue out of it, but I doubt it would stick.

    This Hyundai dilemma would make an excellent business school case study.  This is a destiny-changing decision for Hyundai Automotive and it's a tough call.  They need to look hard at the Foxconn situation.  They get huge business at (presumably) low profit margins with big swings based on decisions by Apple and market forces.  If I were a boss at Hyundai I think in my heart of hearts I wouldn't want to be on the other end of that relationship (even if it were good for Hyundai the company).  It's just more fun/challenging/rewarding to focus on making your own stuff.  On the other hand is their existing auto business all that awesome and worth keeping?  If it's just a so-so performer, why not take a shot at this Apple relationship?  This decision impacts Hyundai way more than it does Apple; Apple has alternatives. Hyundai just has this unpredictable wild card offer from Apple versus the status quo (which maybe isn't so rosy).
    watto_cobra
  • Reply 26 of 82
    GG1 said:
    dk49 said:
    dk49 said:
    If Hyundai decides to Ditch Apple, and Apple doesn't find another car manufacturer ready to assemble their cars, it will become really tough for Apple. They will have to build their own factories which will further delay the project. Though I wonder why Magna didn't say yes to it. They are basically the Foxconn for car manufacturers. And I am sure Apple must have approached them earlier.
    Like you, I think Apple contacted Magna early in the process.  Probably one of the first companies Apple contacted.  I think 2 things made Magna an unacceptable partner. 
    1. Location - I really think Apple desires a US assembly location.  The infrastructure for manufacturing and assembling their general tech (phones, computers, tablets, etc) is concentrated in Asia.  That's not the case for cars, and assembly in the US could even be cheaper.   Magna has no N. American plants.  It's rumored (again) they're looking to open a N. American plant, but that rumor has surfaced many times over the past couple of decades.
    2. Capacity - I've no doubt Magna could handle Apple's initial assembly and volume.  Apple's thinking long term.  Scale and capacity would be Magna's issue.  Magna doesn't have an advantage in ether of those factors that could compete with Hyundai's capacity.  Hyundai/Kia has the ability scale their production to meet any capacity Apple may need.  Magna doesn't have that ability.  They already contract manufacture Jaguar's I-Pace and E-Pace, Toyota's Supra, BMW's 5-Series and Z4, and MB's G-Class.  

    When this story initially broke, I said Apple was looking for an OEM/contract manufacturer, not a brand partner.  Some people are still incorrectly looking at this from a brand partner perspective.  Not really sure why.  Questions like, "why Hyundai and not BMW, MB, Porsche, or [insert luxury brand here]" still abound.  None of those brands would ever consider being an OEM manufacturer.  They would have the same concerns that Hyundai is expressing about brand erosion, 'cept their concerns would be magnified because their brands are waaaaaaay more valuable and influential than Hyundai's.  That's not a knock on Hyundai.  That's just reality.
    I agree with you on the aspect of finding a manufacturing partner. I had mentioned the same thing when people were like "Hyundai sucks. Why not BMW?". If Apple has to build its own factories, it's going to make this project much more complex and time consuming, and delay it by a few more years. 
    Though Apple might indirectly partner with Magna in a way they did with Sharp for manufacturing LCD displays. They can pump in half of the money (or more) in Magna required to make a N. American plant. A financial push from Apple, combined with the long term benefits might be enough for Magna to start building a plant in N. America.
    I agree that a US location is key, and maybe Magna could be persuaded to build in the US. And Hyundai/Kia seem to have their hands full with the popularity of their cars now (new Sonata, Palisade, etc.), so they may not have the capacity. And the quote from the Hyundai exec tells me it won't happen. Both want total control. Hyundai are not a contract manufacturer.

    So I wonder if Apple may buy or partner with an EV company such as Lucid or Rivian. IMO both companies have taken the time to develop their vehicles and have not made splashy marketing/tweet claims. In other words, a similar behavior to how Apple operate (and total opposite to Nikola and Musk's tweets). And both are located in the US.
    Rivian is in bed with Ford to the tune of a $500 million dollar platform sharing agreement.  Lucid? Maybe but probably not because they have a lot of foreign investment from Chinese firms, Japanese firms and the Saudis.  The Saudi Arabian Public Investment Fund dropped a $1 billion investment into Lucid.  The Saudis are thought to have a majority stake in Lucid.
  • Reply 27 of 82
    CarmBCarmB Posts: 58member
    Apple will not agree to let a manufacturing partner call the shots in any appreciable regard, especially in terms of what characteristics the finished product will possess. There wouldn't be much point in doing a vehicle that lacked Apple's distinct design approach and I have to think Apple intends to market and service the vehicle as a distinctly Apple endeavour. Any partners would, I would think, have to be prepared to fade into the background, content to make money on the production side but not be putting its branding on the end result. Apple might be fine with Hyundai assembling its vehicles but it would not be interested in Hyundai then bringing those vehicles to market as Hyundais, Kias, whatever. The product, from a consumer's perspective, would an Apple endeaver all the way. The manufacturer would just be the company Apple contracted to do the actual assembly, which is how most of Apple's product is brought to market. 

    It wouldn't even be farfetched for a manufacturing intiative to be conjured up to meet Apple's needs, with a third party investing in the manufacturing capability to build Apple's car, cashing in on Apple's substantial brand recognition. It would make more sense, really, than conjuring up a start-up to produce a BEV with no established brand recognition, hoping to build the brand as Tesla has done. Musk was able to build up Tesla from nothing bcause mainstream automakers were not doing BEVS. That's changing. Volkswagen in particular is puursuing BEV development aggressively. GM is pursuing BEV development significantly as well. Startups like Tesla will have a harder time going forward. Apple would have the advantage of being a high-profile brand with a long history of segment-defining innovation. 
    watto_cobra
  • Reply 28 of 82
    flydogflydog Posts: 1,094member
    Who is the boss?! It certainly doesn’t help to discuss this in public. B)
    Hyundai hasn't discussed anything in public. If you bothered to read past the headline you would know that this is a rumor based on an alleged conversation with an "unnamed executive" and other alleged "insiders."  

    As far as we know, these "insiders" may be in charge of the janitorial department, or may not exist at all.


    MacProwatto_cobra
  • Reply 29 of 82
    postulantpostulant Posts: 1,272member
    Sounds like a lie actually...
    watto_cobra
  • Reply 30 of 82
    Consider the alternative:   Compete against the Apple car manufactured by another car maker.
    StrangeDayswatto_cobra
  • Reply 31 of 82
    flydogflydog Posts: 1,094member

    lkrupp said:

    Also interesting is that GM has announced they will be all electric by 2035.
    Not interesting at all.  There won't be much of a gas vehicle market in 2035 given that many countries and US states are implementing complete bans on fossil-fueled vehicles or requiring a substantial percentage of new vehicles to be electric.

    What would be interesting is a car manufacturer committing to build only fossil-fueled vehicles after 2035. 
    watto_cobra
  • Reply 32 of 82
    flydogflydog Posts: 1,094member

    xiffbk484 said:
    I think that this would be a HUGE opportunity for Hyundai and Apple!! Why wouldn’t Hyundai want to collaborate with the most valuable company in the world?!? I also think that they should collaborate with Luxury brands like BMW, Mercedes-Benz, and maybe Lexus


    What's a "luxury brand" and why does it matter?  Lexus is made by Toyota, and there is no difference in the mechanical underpinnings across the two brands. Mercedes and BMW both build crapbox economy vehicles (Smart, Mini, etc).  

    Hyundai does in fact build "luxury" vehicles that compete directly with Lexus, BMW, and Mercedes.  In fact, every major manufacturer builds luxury vehicles.  The only independent luxury-only manufacturer that comes to mind is Aston Martin, one of the least reliable brands. 

    Moreover, BMW and Mercedes are consistently beat out by Hyundai in quality surveys. 




    edited January 2021
  • Reply 33 of 82
    Nice! Looks like I was right about Genesis. Makes the most sense for Apple. 

    But not really for Hyundai. 

    They are a car company that is all about building the best vehicles the same way Apple is about computing. 

    Hyundai should form another premium sub brand so as not to dilute its other brands. A specific luxury smart car brand. 

    They worked really hard to get Genesis going and they are doing a stellar job. Brand is on point. Don’t mess with it. 

    They need to secure long term contracts with Apple as well. Don’t just get “used.” This has to work for both. 

    This is a perfect match. The best computing company and the best auto engineers coming together. Just need to iron out the wrinkles to make sure it’s equitable and only becomes a strength. 
  • Reply 34 of 82
    Hyundai's market cap is less than $3G USD. Tim could buy them with change in the couch cushions.
    I don't think Apple has 3 gazillion dollars in the bank.

    But seriously given the cartel-like corporate culture I can't see a US company being able to pluck off a major unit from one of the main South Korean conglomerates.  And why Apple want to own a Korean-based company.  That's sounds like a nightmare and unlike anything Apple has ever done before.  In short, that's not happening.
    watto_cobra
  • Reply 35 of 82
    MacProMacPro Posts: 19,505member
    Hyundai's market cap is less than $3G USD. Tim could buy them with change in the couch cushions.
    I don't think Apple has 3 gazillion dollars in the bank.
    Just wait ... ;)
    randominternetpersonwatto_cobra
  • Reply 36 of 82
    Wow, didn't even know Hyundai gave Genesis its own website as the Genesis is not on Hyundai website.
    watto_cobra
  • Reply 37 of 82
    Apple is going to end up buying a small car company.
    watto_cobra
  • Reply 38 of 82
    lkrupplkrupp Posts: 10,172member
    Apple is going to end up buying a small car company.
    They’ve never done something like that. As for Hyundai honchos agonizing over whether to partner with Apple just remember that AT&T was the only cellular provider at the time to take on the new iPhone under the conditions Steve Jobs demanded when all the others said no.
    randominternetpersonwatto_cobra
  • Reply 39 of 82
    1348513485 Posts: 243member
    paraeeker said:
    The sentiment’s not hard to understand: Consider if Hyundai came to Apple to ask it to make Hyundai branded laptops...

    It’s not just about revenue or profits. 

    Apple should consider investing in a small car company like Lotus. Or collaborating with JLR (Tata). 

    Now that would be interesting!

    Lotus is a "no go", even if its annual income is probably less than Apple spent on landscaping (US $13.6 million in 2017). It's owned by Geely, which means all Apple automotive designs and technology would be stolen and used for a knock-off Titan ("Titano" "Not stolen, we had this design for many, many years already...).

    JLR (Jaguar-Land Rover for US people) unfortunately has a rather poor reputation for quality, even if the designs are admired and cribbed (Ford we're looking at you). And they have lost about a combined US 5 billion in 2019-2020 fiscal years. One of thee biggest complaints about the company is that they have too many platforms they work on and no clear idea on how to reduce them. Taking on Apple would just add another one.
    watto_cobra
  • Reply 40 of 82
    1348513485 Posts: 243member

    GG1 said:
    I agree that a US location is key, and maybe Magna could be persuaded to build in the US. And Hyundai/Kia seem to have their hands full with the popularity of their cars now (new Sonata, Palisade, etc.), so they may not have the capacity. And the quote from the Hyundai exec tells me it won't happen. Both want total control. Hyundai are not a contract manufacturer.

    So I wonder if Apple may buy or partner with an EV company such as Lucid or Rivian. IMO both companies have taken the time to develop their vehicles and have not made splashy marketing/tweet claims. In other words, a similar behavior to how Apple operate (and total opposite to Nikola and Musk's tweets). And both are located in the US.
    Rivian isn't likely, as it has substantial investments from Ford and...Amazon. Lucid on the other hand just completed a US factory in Arizona for electric cars only, and they have had money issues in the past. Their car designs, although somewhat vaporware, are very innovative, but their tentative pricing is even more than "Apple-like" bordering on Maybach-Rolls Royce-like, in the range of $160,000.
    watto_cobra
Sign In or Register to comment.