The on again/off again bromance between Hyundai and Apple is now officially over. According to Reuters, Hyundai announced this week, “We are receiving requests for cooperation in joint development of autonomous electric vehicles from various companies, but they are at early stage and nothing has been decided. We are not having talks with Apple on developing autonomous vehicles.”
If you have a suspicious mind — or legal training — you could see that statement as ambiguous. The two companies may have shelved plans to build self-driving cars together and still have plans for Hyundai to manufacture automobiles for Apple that the California company would later modify to meet its specific needs. Apple has no vehicle manufacturing capability of its own and has never expressed any interest in building its own factories. If it ever gets around to making an Apple-branded car, it would most likely choose an established company with experience in auto manufacturing and Hyundai has a global reputation for building high quality vehicles.
The news sent the stock prices of both Hyundai and KIA plummeting. Both had been up sharply on the news of the rumored tie up with Apple. By the end of the week, shares in both companies declined by about $8 billion, although much of that represented the recent increases based on speculation. Investing ain’t for sissies.
KIA Plans EV Push
Just a month ago, KIA said it planned to offer 11 EVs in its product lineup by 2027. Now it has brought that timeline forward. Speaking to investors this week, KIA CEO Ho Sung Song announced that his company would be accelerating its electrification by one full year, according to a report by Car and Driver. Song said 7 of those models would be based on the new e-GMP electric car platform jointly developed with Hyundai. The company has released a rather useless teaser photo of something — it looks very SUV-ish — code named CV, that may represent one of those 7 new battery electric vehicles. It says to expect more details next month.
KIA says its goal is to sell 40% electric vehicles — including plug-in hybrids — by the 2030s. That is way too wimpy a goal, one that sounds more like what we expect from Toyota. Today it offers two battery-powered cars in the US, the KIA Soul Electric and the KIA Niro Electric. Good luck finding either one outside of California or Oregon. The supply in states that follow the California emissions rules is limited. In other states, it is non-existent.
Autonomy & Subscriptions
Kia is also looking to increase its purpose-built vehicle business by expanding into autonomous delivery vehicles, Car and Driver says. Its first electric PBV will be unveiled in 2022, and it hopes to sell one million of these types of vehicles by 2030 by working with other companies to develop platforms for them. The company also announced this week the Kia Flex subscription service currently available in Korea will go global later this year. It will be renamed Kia Subscription and will be run by the Hyundai Motor Group’s Sixt Leasing division.
The subscription model bundles insurance and maintenance into one monthly payment and in Korea, subscribers can switch to another car at the end of each month. There is no word on whether that feature will be part of the subscription program in other markets. We also don’t know if the subscription model will allow people to drive an electric car for less than purchasing one outright or leasing one. Keep in mind that the company would be able to claim any available EV incentives rather than the driver.
What About Canoo?
The piece that is hiding in plain sight here is that Hyundai has made a significant investment in Canoo, the southern California startup that is focusing on — you guessed it — purpose-built vehicles, electric delivery vehicles, and subscription services. As Kyle Field reported last year, Ulrich Kranz, the head of Canoo, says, “When we revealed our subscription-only Canoo vehicle back in September, we were overwhelmed with the positive response we got from consumers. Now we are excited to offer our community the opportunity to sign up to ride The First Wave with us. As part of our all-inclusive, hassle free and commitment free car experience, people can join the waitlist in a matter of seconds with no obligation.” The first cars from Canoo are expected to be available this year.
Might the new distance between Hyundai/KIA and Apple result in a new closeness between Hyundai/KIA and Canoo? Stay tuned.
Featured image courtesy of Hyundai.
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