With Apple’s first vehicle expected to hit the streets as early as 2025, several of the company’s current suppliers are reportedly vying to take the lead on producing the much-rumored Apple Car.
Apple’s Project Titan has become one of the company’s most open secrets over the past few years, which is understandable; a project of the scale and scope of an autonomous vehicle is very difficult to keep under wraps. This has been exacerbated by the fact that Apple has been talking to multiple carmakers and other automotive companies over the past couple of years.
Now, according to DigiTimes, two of Apple’s long-standing manufacturing partners are hoping to move beyond producing iPhones, iPads, and Macs and into the lucrative electric car business.
Foxconn and Luxshare Precision have already taken steps into the electric vehicle (EV) market in their own right. In 2021, Foxconn, which is already Apple’s main iPhone assembler, released its own electric vehicle chassis and platform in late 2020, which became the basis for a deal with San Francisco-based startup Fisker last year to produce 250,000 EVs for the company.
As a result, many analysts believe that Foxconn is better positioned than most to become Apple’s lead partner for the Apple Car. After all, there’s already a solid longstanding relationship between the two companies, and clearly Foxconn is building its expertise in this area.
Still, there’s a pretty big difference between making iPhones and producing full vehicles. Foxconn may have a great deal of experience with electronics, but mechanical components are another matter entirely.
Apple’s other key supplier in China, Luxshare, has also been getting its feet into the automotive business, reaching a strategic cooperation agreement with China’s Chery to build EVs for the company.
Apple’s Quest for Automotive Partners
Still, as DigiTimes acknowledges, many believe that neither Foxconn nor Luxshare have the necessary foundation to meet Apple’s requirements, which are expected to be as stringent for the Apple Car as for any other Apple product.
While these suppliers could play a role, especially in the longer term, Apple has been talking to other partners with a far more solid automotive background, such as South Korea’s Hyundai and Canada’s Magna International.
In addition to decades of experience in automotive manufacturing, Hyundai and Magna also offer Apple another important advantage — the ability to diversify its supply chain and decrease its reliance on China. While both Luxshare and Foxconn have facilities outside of China, they’re still headquartered in China and answerable to Chinese authorities.
However, it’s not clear where Apple stands with Hyundai. The two companies were reportedly in talks early last year, but those also ended abruptly as Hyundai executives feared becoming merely a contract manufacturer for Apple and losing their own brand in the process. Some had suggested farming the Apple Car out to its Kia subsidiary to avoid these issues, but ultimately, it seemed that wasn’t enough to placate the company’s fears.
Even so, however, it’s not clear if the door was completely closed to future discussions, and it’s possible that at least some discussions have resumed between the two companies.
On the other hand, Apple has had a much cozier relationship with Magna, which has long seemed like a perfect fit for the Apple Car. Headquartered just outside of Toronto, Canada, Magna International actually boasts 342 manufacturing operations across 27 countries, and several decades of experience manufacturing automotive systems and components for everyone from Audi to Jaguar.
Apple was reportedly in talks with Magna Steyr, the company’s Austrian subsidiary, over five years ago, and while it’s unclear where those talks went, there’s obviously some history there.
More importantly, not only do analysts describe Magna as being “amazingly good” at what it does, but it has no branding ego to bruise — for well over 50 years Magna’s entire business model has been to serve as the unseen power behind other big-name brands. As far as Magna is concerned, Apple would be just another Audi or BMW.
To make matters even more interesting, LG Electronics and Magna partnered last year to form LG Magna e-Powertrain, melding the electronics expertise of South Korea’s LG with the automotive chops of Magna. The new partnership would see the two companies joining forces to make key components for electric vehicles, and some sources have suggested that Apple could tag LG Magna to handle the first run of the Apple Car.
Either way, time is running out for Apple to close these deals and figure out who will actually make the mythic Apple Car. From what we’re hearing, Apple hopes to make that decision this year, regardless of how long it may take before the first Apple Car rolls off a production line somewhere.