Apple Car Team (AAPL) discuss EV plans with key component makers during secret Korean weekend getaway
Apple Car, the iPhone maker’s electric vehicle program under Project Titan, continues to be an active topic in the tech-driven rumor mill amid the usual approach of the world’s largest company in terms of market capitalization.
Now, however, new reports from South Korea indicate that the Apple Car program is progressing at a fairly steady pace. To witness it, Korea weather Now cites an industry source to report that the Apple Car team met with major Korean manufacturers of electric vehicle components over the weekend. The list allegedly includes SK Innovation, the electric vehicle-focused battery manufacturing arm of the SK Group, as well as LG Electronics, which recently formed a joint venture – dubbed LG Magna e-Powertrain – with Canadian auto parts maker Magna. International (NYSE: MGA). In addition, according to the report, the Apple Car team also met with the Hanwha Group, a large South Korean business conglomerate.
Recall that Korea Times indicated a few months ago that the joint venture between LG Electronics and Magna International was about to win a manufacturing contract for the Apple Car. However, this development has not yet officially materialized. If this collaboration were to materialize, it would allow Apple to make better use of its existing synergies with LG subsidiaries. Plus, Apple would then be able to tap into Magna’s substantial manufacturing prowess. As a reminder, Magna already has production contracts with about 45 OEM customers, including Toyota, BMW, Honda, Hyundai, Volvo, Volkswagen (VW) and Fisker (NYSE: FSR). Recently, the company signed an agreement with Israeli startup REE Automotive to build its modular skateboard platform for electric vehicles.
In another important insight from this weekend’s developments, Apple (NASDAQ: AAPL) seems to be turning to cheaper lithium iron phosphate (LFP) batteries for its EV project. Although these batteries have a cost advantage, they offer poor performance in cold weather. If this speculation comes to fruition, Chinese battery makers would retain an overall advantage, especially as South Koreans specialize in more expensive lithium-ion cells. It is for this reason that some analysts consider Contemporary Amperex Technology Ltd. (CATL) like favorite for winning a contract to manufacture Apple Car batteries. Of course, CATL is already working with Tesla and Volkswagen and can serve as an effective production partner for Apple.
As for the reported details of the production of the Apple Car, a prototype is expected by 2024. In addition, the initial production volume is expected to be quite low as Apple assesses the prospects of the electric vehicle and its reception on the Marlet. Of course, Apple could potentially bring in other manufacturers and supply chain partners for its EV project.