Investing.com - Apple (NASDAQ: AAPL) is close to completion of the transaction with Hyundai-Kia (LON: 0538Q) for the production of an autonomous electric vehicle under Apple's brand at the KIA assembly plant in West Point, Georgia, reports CNBC.
Apple shares rose on this news by more than 2%.
Sources familiar with the interest of Apple to cooperate with Hyundai, say that the technological giant wants to build Apple Car in North America with a reputable automaker, ready to allow Apple to control the software and hardware of the future electric vehicle.
Running the production of an electric car "Apple Car", which is developed by the Apple command, is estimated at 2024, although it is possible that this important milestone can be postponed for a later date due to a number of reasons.
First, there are no agreements between the two companies, and Apple may eventually decide to become a partner of another automaker separately or in addition to Hyundai. According to an informed source, "Hyundai is not the only automaker with which Apple could make a deal."
Nevertheless, this cooperation has advantages for both companies. Apple's solution to produce your own car opens up an opportunity to access the world car market.
The smartphone market is estimated at $ 500 billion a year, and Apple takes about a third of this market. The car market is $ 10 trillion. Thus, Apple will need to take only 2% of this market to achieve the current size of your own iPhone business, wrote Morgan Stanley analyst (NYSE: MS) Katie Huberti,
For Hyundai-Kia, this cooperation also has its own advantages: working with Apple, the South Korean automaker will speed up the development of its own autonomous electric vehicles. In addition, the KIA plant is located about 90 minutes south-west of Atlanta in Georgia, and expanding the scale of production and the use of Hyundai-Kia supply chain can be carried out relatively quickly.
It is too early to talk about the future electric vehicle, but it is known that it will be designed to work without a driver and focuses on the last mile. This may mean that Apple cars are at least at the initial stage, can focus on food delivery operations and on robotxy functions.
- In preparation, CNBC materials are used
Read Original Articles on: Investing.com