The Cost of Apple's Rumors
The first rule is this: any rumors about a partnership with Apple must be real, if not, investors will punish. Yes, Hyundai and Kia are learning the hard lessons on what it means to be rumored to be working with Apple, and suddenly see everything fall apart. The companies are bleeding valuation after the deal fell off. Apple had wanted to use them as the vehicle equivalent of Foxconn. Foxconn assembles iPhone and other mobile products Apple makes. Hyundai and its subsidiary Kia would have helped Apple on assembling its planned Apple car.
South Korea’s Hyundai Motor Co said on Monday it is not now in talks with Apple Inc on autonomous electric cars, just a month after it confirmed early-stage talks with the tech giant, sending the automaker’s shares skidding.
Wiping $3 billion off its market value, Hyundai’s stock slid 6.2%. Shares in its affiliate Kia Corp, which had been tipped in local media reports as the likely operational partner for Apple, tumbled 15% - a $5.5 billion hit.