Apple to Invest $3.6 Billion in Kia to Make the Apple car

soxhop411

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Apple Inc. will invest 4 trillion won ($3.6 billion) in Kia Motors Corp. as part of a collaboration with the South Korean carmaker on making electric vehicles, the DongA Ilbo newspaper reported, without citing anyone.
The iPhone maker plans to set up production with Kia and build Apple cars at the automaker’s facility in Georgia, U.S., the newspaper said. The companies may sign a deal on Feb. 17 and aim to introduce Apple cars in 2024, according to the report, which said they have an initial target to produce 100,000 autos a year.
https://www.bloomberg.com/news/articles/2021-02-03/apple-to-invest-3-6-billion-in-kia-to-make-evs-donga-saysThis will be interesting to follow to see if they try and go head to head with Tesla.
 

Cellar-Door

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Gonna suck when the Apple car 2 comes out and they throttle the Apple car 1 to 35 MPH.
 

Manramsclan

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Kia has been making nice cars lately. Based in San Diego now. I would consider buying an electric car with Apple functionality.

I just don't want to have to buy a new car every 3 years because mine stops working.
 

canderson

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Jokes aside, I envision a deal like what Apple does with Samsung. They use all the parts and R&D from another company and putting it in its own design. My hunch is Huyndai/Kia wanted a cash infusion for battery tech and Apple is more than happy to provide capital.

I still think Apple should have bought Tesla, but they weren't going to deal with Musk in any way, shape or fashion.
 

Kremlin Watcher

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$3.6 billion is not a huge investment in designing and building cars that need to be loaded with technology. Ford spends twice that every year in capex.
 

nattysez

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The key word in that story is "autonomous." Unless their technology is WAY ahead of Tesla's and Waymo's, I doubt they are building for consumers. More likely they are building for use cases like local transportation. Tim Cook is going to have a hard time selling himself as someone who cares about his users if he launches the same kind of half-assed semi-autonomous functionality Tesla has rolled out thus far. Maybe they think they can get theirs working in three years -- seems...ambitious.

I'm also not sure I'd be too excited about jumping into an autonomous car from the company that thought that the original Apple Maps product was production-ready.
 

SeoulSoxFan

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As most of you know, Hyundai & Kia are under the same umbrella. In fact, Chairman Chung Euisun is (reportedly) scheduled to attend the official signing ceremony himself, slated on the 17th.

The route Apple is taking with Kia seems pretty similar to what they've done with LG Display. Invest in the infrastructure, technology, engineering, design, and implement the deliverables in its iPad and iPhone models.

Now, another significant player in this is is Hyundai Globis. The global subsidiary operates 4 offices/HQs in the US, including the Georgia plant etc. and GET (distribution network), etc. Of course, the number of advanced patents and tech already owned by Hyundai, including the ambitious E-GMP electronic vehicle platform
 

canderson

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As most of you know, Hyundai & Kia are under the same umbrella. In fact, Chairman Chung Euisun is (reportedly) scheduled to attend the official signing ceremony himself, slated on the 17th.

The route Apple is taking with Kia seems pretty similar to what they've done with LG Display. Invest in the infrastructure, technology, engineering, design, and implement the deliverables in its iPad and iPhone models.

Now, another significant player in this is is Hyundai Globis. The global subsidiary operates 4 offices/HQs in the US, including the Georgia plant etc. and GET (distribution network), etc. Of course, the number of advanced patents and tech already owned by Hyundai, including the ambitious E-GMP electronic vehicle platform
How far along has Kia's quality come? It was ... not good ... for a while, but I really haven't paid any attention to them in years. Genesis look amazing.
 

crow216

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As with all of Apple's 'innovations," this will be criticized for a year or two, then people will slowly adapt, then they will take over the market, then other companies will follow their lead. They did it with the iPad, AirPods, and the Apple Watch. In other words, I fully expect to own an apple car in 5-10 years.

I'd argue that the industry is absolutely ripe for a disrupter. I consider myself a sort of auto-enthusiast and there are very few brands that aren't on auto-pilot at the moment. Design a car, let the cycle last 4-8ish years, redesign it, rinse and repeat. Even Teslas are already pretty boring aesthetically and haven't changed much internally.
 

crow216

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How far along has Kia's quality come? It was ... not good ... for a while, but I really haven't paid any attention to them in years. Genesis look amazing.
Both Kia and Hyundai have drastically improved their quality. The difference between those brands and the luxury brands now tend to be in the engine bay, luxury aesthetics, and some unique feature but not so much on reliability. I've got a 2019 Volvo XC60 T6 and I would trade it in tomorrow for a Hyundai Genesis. I want to smash this volvo through a wall I hate it so much. I have no idea why this car costs $60,000.
 

gtmtnbiker

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I've got a 2019 Volvo XC60 T6 and I would trade it in tomorrow for a Hyundai Genesis. I want to smash this volvo through a wall I hate it so much. I have no idea why this car costs $60,000.
We're planning to replace our CRV with another one in a year but last night my wife was asking about the XC40. What do you hate so much about the car?

I think Teslas still look great. It'll be interesting to see what Apple comes up with. I would have to think they'll support integration with Android as well as iOS.
 

Koufax

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I had a Kia rental a couple of years ago. I was shocked at how nice it was.
 

crow216

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We're planning to replace our CRV with another one in a year but last night my wife was asking about the XC40. What do you hate so much about the car?

I think Teslas still look great. It'll be interesting to see what Apple comes up with. I would have to think they'll support integration with Android as well as iOS.
1) Electronics are not intuitive and very difficult to control, especially from the driver's seat. (e.g. toggling from your favorite music channels to stuff not on your list requires at least a few touches that you need to carefully look at).
2) GPS is the worst I've ever used in my life. It doesn't orient well, the directions are confusing, and the map is hard to quickly pick up while driving. Waze, which is awesome, gets reduced to a tiny screen rather than full screen. Got this great big screen and you carplay is like a 4-5 inch square.
3) Need to put air in your tire? Prepare for a multi-step calibration process with no active monitoring for you to see what the car is reading.
4) Have had to take it to the dealer twice because the controls on the steering wheel weren't working properly.
5) I paid for Polestar mode, which is how I like to drive. However, even though you can setup profiles, you can never have the car start in anything except comfort mode. Comfort mode sucks.
6) My wife and I have separate profiles and they're supposed to be aligned to our keyfobs. If I start the car, my profile should open. Instead, it just completely guesses and is never consistent. Changing profiles takes a minute.
7) Transmission. This car has a supercharger and a turbo. Downshifting (yes, I'm driving an automatic) causes the turbos to spin like crazy. It sounds ridiculous, I'll be doing 15 miles an hour and the car sounds like I'm doing 100.
8) Bucket seats suck. This isn't a racecar. Bucket seats are uncomfortable for long drives.
9) Got the premium wheels (21''). I think they're made of paper. If I breath on them heavy, they scratch.
10) Sometime last summer, I woke up and went for a morning coffee after a big rain storm. Went outside and all four of my windows were completely down and the car was soaked inside. Keep in mind, I never open my back windows and barely open my windows. It wasn't me. I googled and found out that this could be a key fob issue so I just blamed myself and crossed my fingers. Couple months later, my uncle who bought the identical car (we both them at the same time), calls me up and says it happens to him every time there's heavy rain. Dealership said they never heard of the problem.

I've got more.
 

SeoulSoxFan

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How far along has Kia's quality come? It was ... not good ... for a while, but I really haven't paid any attention to them in years. Genesis look amazing.
Both Kia & Hyundais are some of the best bang-for-the-buck carmakers right now, IMHO. And this is coming from someone who once swore never to buy one, patriotism be damned.

Their SUVs are a big hit and people are paying over the sticker price to get them. Kia's Telluride and Hyundai's Palisades are really, really well made and suited for American tastes (Telluride was designed and built in the US from the ground up).

View: https://youtu.be/XIaRLDLYKTY


However, I saw the new GV80 at a super-mall (they have BMW, Mercedes, Genesis, etc. showrooms inside these mini-fortresses) and wow, it was absolutely gorgeous.

View: https://youtu.be/myCJXRSkmYM


Now, domestic (Korean) Kias and Hyndais have worse warranties and cut corners, as the laws themselves aren't as rigid as the American counterparts (number of safety bars in each doors, for example). However, the made-in-the-USA are pretty solid. I know a couple of friends who will reverse-import a Hyundai from the States back to Korea for that reason.

Hyundai also has invested heavily into hydrogen fuel autos. They really do make more sense more than electrical ones but the fueling stations are still too expensive to build.

I believe you can buy Hyundai stocks through Fidelity but haven't checked (we bought ours locally through KOSPI).
 

canderson

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Thanks. I’m looking for a RAV4 Prime as I don’t believe an all electric car is feasible for our lifestyle yet our (normally) 5 mile commute and daily 20-30 mile drive is perfect for a PHEV like that.
 

SeoulSoxFan

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I think it's too early to say the deal is completely off.

Apple is said to have reached out to Hyundai/Kia, Ford, GM, Mazda, Honda, and Tesla.

Pre-Covid, the only company that was in the top 10 in terms of both overall car production (#5) and electric car production (#6) is H/K. Unless Apple buys Tesla (ummm), I still think H/K makes the most sense for Apple.

Now, allegedly the deal was put off due to the press leaks. If so, that is certainly worthy of criticism on H/K's part. However, is Apple willing to shut out (potentially) its most profitable partner because of it? Isn't it more likely that:

1) The deal was nowhere near the finish line that the press reported
2) Other players, namely one or more of the 6 major Japanese car makers, are trying to up the deal
3) Apple is temporarily punishing H/K to muzzle up any future leaks

We can reasonably assume that Apple wants an auto-equivalent of Foxconn. H/K may play along but only up to a certain point. It certainly has more leverage than Foxconn ever had.

Just guessing out loud, if the deal falls through, I can see H/K starting up a bigger partnership with Samsung/LG for the software/UX/display/AI parts. It could even be a blessing in disguise if Apple tries to bully H/K into a Foxconn-esque partnership. That's why some local critics have called a potential deal "humiliating" as H/K will basically become an OEM for Apple.

Of course, not partnering with Apple means H/K will go all in on Google's self-driving technology, as it will be even more critical to an auto company's long term success than transitioning into an all-electronic/hydrogen platform. Very few are thinking H/K will soon develop a self-driving O/S on its own (although I can see them catching up faster than people think).

In other words, this saga is a fascinating one and will have more twists and turns this year and beyond.
 
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mauf

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As with all of Apple's 'innovations," this will be criticized for a year or two, then people will slowly adapt, then they will take over the market, then other companies will follow their lead. They did it with the iPad, AirPods, and the Apple Watch. In other words, I fully expect to own an apple car in 5-10 years.

I'd argue that the industry is absolutely ripe for a disrupter. I consider myself a sort of auto-enthusiast and there are very few brands that aren't on auto-pilot at the moment. Design a car, let the cycle last 4-8ish years, redesign it, rinse and repeat. Even Teslas are already pretty boring aesthetically and haven't changed much internally.
If you’re basing your judgment on infotainment, then yeah, there haven’t been any breakthrough innovations since Bluetooth connectivity became standard on most new vehicles about a decade ago. But that’s a small part of overall auto industry R&D.

The Big Three‘s innovation efforts have been skewed toward light trucks, so if you aren’t in the market for a truck those investments would be invisible to you. But even in the sedan space, you have options like plug-in hybrids that weren’t available a few years ago, and most new cars have technology-enabled safety features built on rudimentary self-driving tech that would’ve been unthinkable a decade ago.

Will the Apple/Kia contract be material enough to either party that they’ll have to file with the SEC? I think there would be some details in there that might signal the long-term thinking of the parties.