Home Business Hyundai, Kia shares tumble after automakers say they’re not in talks with Apple to develop a car

Hyundai, Kia shares tumble after automakers say they’re not in talks with Apple to develop a car

Hyundai, Kia shares tumble after automakers say they're not in talks with Apple to develop a car

A logo of Hyundai Motor is seen on a glass door at a company branch in Seoul on July 23, 2015

Jung Yeon-Je | AFP | Getty Images

South Korean automakers Hyundai Motor and Kia Motors said Monday they are not in talks with Apple to develop an autonomous vehicle.

Hyundai Motor shares fell 6.41% in South Korea on Monday morning while Kia Motors shares dropped 13.2%. Other affiliates including Hyundai Wia, Hyundai Mobis and Hyundai Glovis were also down sharply.

“Hyundai Motor is getting requests from multiple companies for cooperation in joint development of autonomous, electric vehicles but nothing has been decided since it’s in early stage,” the company said, according to a CNBC translation of a regulatory filing.

“Hyundai Motor is not in talks with Apple on autonomous vehicle development,” it added.

Its affiliate Kia Motors, which is the second-largest car manufacturer in South Korea behind Hyundai, made a similar filing. The company said it was reviewing prospects of cooperating with “multiple companies overseas” over autonomous electric vehicles — but nothing has been decided.

Kia Motors also said it was not in talks with Apple.

Hyundai initially said last month it was in early-stage talks with Apple, but later revised the statement and made no mention of the iPhone maker. It led to a surge in shares of Hyundai and its affiliates, including Kia Motors, at that time.

This month, CNBC reported that Apple was close to finalizing a deal with Hyundai-Kia to manufacture an Apple-branded autonomous electric vehicle at the Kia assembly plant in West Point, Georgia. Sources told CNBC’s Phil LeBeau that no agreement had yet been reached and that Apple may ultimately decide to partner with another automaker separately, or in addition to working with Hyundai.

Shares may drop further

Retail investors have bought Hyundai Motor and Kia shares worth roughly 915.7 billion Korean won ($817 million) and 798.8 billion won (about $713 million), respectively, since the Jan. 8 speculation over a potential collaboration with Apple, according to Sung Yop Chung, regional head of automobiles and components at Daiwa Capital Markets.

“Following the negative vibe from both (Hyundai Motor) and Kia’s filing this morning, highlighting that there is currently no EV cooperation with Apple, worst-case suggests that Kia’s shares could correct as much as 31%,” he told CNBC’s Chery Kang.  

Speculation about Apple getting into the auto business has been rife for several years but nothing concrete has materialized.

Some Wall Street analysts see the auto sector as a new market for Apple to grow into, but others caution against the reality of making an Apple-branded car as it could potentially mean heavy investments for low margins.

— CNBC’s Chery Kang contributed to this report.

This article is auto-generated by Algorithm Source: www.cnbc.com

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