Apple, which specializes in electronic devices, is trying to make electric vehicles this time. But the automotive industry is more difficult than you think. Therefore, there is a high possibility of cooperation with other automobile manufacturers. Apple is in discussions with several automakers and has made a collaboration proposal to Hyundai Motor Company.
However, it is not unconditionally good for Hyundai Motor to collaborate with Apple, and it can be a double-edged sword, so executives are thoroughly analyzing it at the business level. In particular, there are three concerns for Hyundai Motor Company. Today’s AutoPost Issue Plus looks at three things Hyundai Motor Company is contemplating about collaboration with Apple.
Written Jinwoong Lee Editor
Among 5 companies with dedicated EV platform
Collaboration with Hyundai Motor Company is the most powerful
Currently, five manufacturers with dedicated electric vehicle platforms are Hyundai, Tesla, GM, Volkswagen, and Toyota. If Apple collaborates on electric vehicle production, the industry predicts that five companies with dedicated platforms will be the most promising candidates.
Tesla is Apple’s biggest competitor, and Volkswagen and GM lack the capacity to build partnerships outside of their products. Toyota still lacks competitiveness in the electric vehicle market. Hyundai Motor Company is performing well in the electric vehicle market, and its factories are distributed in various places around the world. It can also help compete with rival Tesla through collaboration. It has favorable conditions in many ways.
Subcontracted by Apple
Possibility of falling
When developing electric vehicles in collaboration with Apple, Hyundai can reduce development costs, and as there are many loyal customers of Apple all over the world, Hyundai can aim for promotional effects in a wider area through collaboration with Apple. And there are a number of things that can be a bridgehead for entering emerging markets in the future.
However, since collaboration with Apple may be poisonous for Hyundai Motor Company, executives are considering gains and losses. The first is to become subcontracted by Apple.
Currently, Apple is commissioned to produce most of its products through Foxconn in Taiwan. If the development of the Apple car is completed, it is highly likely that production will be left to Hyundai Motor Company, but in this case, the initiative may be taken away by Apple and the power may be lost.
In addition, it is difficult to secure profitability when a global company such as Hyundai Motors does simple consignment production like Foxconn. In order for Hyundai Motor to secure a certain degree of profitability, Apple must increase the price of Apple cars, but if the price becomes too high in the electric car market where competition will be fierce in the future, even Apple will likely fail. Electronic products sell well at high prices because of Apple’s high brand value, but we cannot guarantee success as automobiles are an industry with a completely different business field and high entry barriers.
This is the reason why Apple’s collaboration with Volkswagen and BMW in the past was broken. In this regard, Hyundai Motor Company is in a position to secure a certain stake in development, design and brand use.
Mass production
Opaque
As automobiles are expensive to develop, it is necessary to secure profits through mass production in order to continue the business. But for now, it’s unclear whether Apple will mass-produce cars. Hyundai Motor Company is well aware of this because it has experienced several failures.
When Apple made Apple TVs in the past, it produced only a small amount, contrary to expectations, and an official from a parts maker said, “The initial quantity ordered by Apple is less than 1,000 units and is not revealing future plans.”
Used in electric vehicles
Operating system problem
The importance of the operating system will increase as future electric vehicles will be equipped with more advanced autonomous driving functions. Hyundai Motor Company is developing its own operating system in order not to be subordinate to other companies in the future car war. The difference between the existence of an independent operating system is really big, it is free from the royalty problem, and it can generate additional revenue such as apps.
However, Apple has long been famous for using its OS exclusively. It is not allowed to install its own OS on other devices or, conversely, to install a third-party OS on its products. Apple cars are also likely to be equipped with their own operating systems such as IOS, and through this, it is highly likely that they will try to control all of the hardware, software, and contents. However, an industry insider said, “There are many things to learn about Apple’s OS development capabilities and content business capabilities, so trying to produce cars with various OSs is not necessarily bad as it helps to secure capabilities.”
In collaboration between Apple and Hyundai Motor Company
Reactions of netizens to Korea
Netizens’ reaction to the collaboration between Apple and Hyundai Motors tends to be divided into positive and half negative. Positive responses include “We should use this collaboration as an opportunity for Hyundai Motor’s growth”, “We can enter more markets”, “This is the strength of Korea”, and “A good opportunity to contain Tesla”.
Negative reactions include “words are collaboration, aren’t they actually subcontractors?”, “Is it unfair that the company that used to be in trouble is going to fall?”, “Hyundai Motors manufactures and Apple eats profits”, “Why collaborate with Hyundai Motor, which has a lot of defects? ?” Etc. It was Auto Post Issue Plus.
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