Shares of Korean automaker Kia Motors surged after a major South Korean newspaper reported that Apple (AAPL -2.34%) will invest $3.6 billion in Kia as part of a deal to build Apple cars in Kia's U.S. factory.
The paper, Seoul-based Dong-A Ilbo, reported that Kia and Apple are close to a deal under which Kia will build Apple's long-rumored electric car in its factory in West Point, Georgia. The initial production target is 100,000 vehicles per year starting in 2024, according to the report, with the potential to expand to a maximum of 400,000 per year.
As part of the deal, Apple will invest 4 trillion Korean won ($3.6 billion) in Kia, per the report.
Apple's long-running project to develop a car has been the subject of rumors for years. Originally thought to be a self-driving taxi, more recent reports hint that the Apple vehicle will be a somewhat more mainstream electric car -- possibly with some self-driving technologies -- that will be thoroughly integrated into the existing Apple device ecosystem. It's possible that the Apple car will be based on the E-GMP electric-vehicle architecture developed by Kia's corporate sibling Hyundai (HYMTF -1.21%).
While the reported production volumes suggest an upscale but not luxury-level price target (in line with Apple's strategy around its other consumer devices), it's not yet clear whether Kia's Georgia factory will be manufacturing cars for global export or just for the United States.
The companies tentatively plan to announce the collaboration on Feb. 17, Dong-A Ilbo reported.