Hyundai shares soar on reports of Apple partnership on electric vehicles

Shares in Hyundai Motor soared 19.4 percent in Seoul on reports by cable broadcaster Korea Economic TV that it was at an initial stage of talks with Apple to manufacture self-driving electric vehicles (EVs) by 2027 and develop EV batteries.

Kia, Hyundai Motor's affiliate, also jumped 8.4 percent at the close.

Apple plans to produce a passenger vehicle that could include its breakthrough battery technology as early as 2024.

Hyundai, South Korea's biggest automaker, confirmed that it was discussing with Apple but noted that talks are in an early stage and there were no decisions yet.

It is unknown whether Apple is in talks with other carmakers.

Cable broadcaster Korea Economic TV said it was Apple who approached Hyundai to discuss a potential partnership.

The two firms have already collaborated on CarPlay, Apple’s software that connects to vehicles.

According to analysts, Apple may be interested in utilizing Hyundai’s electric car platform and facilities to cut costs. Moreover, labor cost with Hyundai is much lower than with US automakers.

Jeong Yun-woo, a professor at UNIST in South Korea and a former Hyundai designer, said it makes sense for Apple to outsource car production to Hyundai as the South Korean firm is known for quality.

Kevin Yoo, an analyst at eBEST Investment & Securities, added that Apple could see Hyundai as an ideal partner since US automakers have strong unions, which Apple would like to avoid.