South Korean automakers Hyundai Motor and Kia Motors said Monday they are not in talks with Apple to develop an autonomous vehicle.
Hyundai Motor shares fell 6.21% in South Korea on Monday while Kia Motors shares plunged about 15%. Other affiliates including Hyundai Wia, Hyundai Mobis and Hyundai Glovis also fell sharply.
"Hyundai Motor is getting requests from multiple companies for cooperation in joint development of autonomous, electric vehicles but nothing has been decided since it's in early stage," the company said, according to a CNBC translation of a regulatory filing.
"Hyundai Motor is not in talks with Apple on autonomous vehicle development," it added.
Its affiliate Kia Motors, which is the second-largest car manufacturer in South Korea behind Hyundai, made a similar filing. The company said it was reviewing prospects of cooperating with "multiple companies overseas" over autonomous electric vehicles — but nothing has been decided.
Kia Motors also said it was not in talks with Apple.
Hyundai initially said last month it was in early-stage talks with Apple, but later revised the statement and made no mention of the iPhone maker. It led to a surge in shares of Hyundai and its affiliates, including Kia Motors, at that time.
This month, CNBC reported that Apple was close to finalizing a deal with Hyundai-Kia to manufacture an Apple-branded autonomous electric vehicle at the Kia assembly plant in West Point, Georgia. Sources told CNBC's Phil LeBeau that no agreement had yet been reached and that Apple may ultimately decide to partner with another automaker separately, or in addition to working with Hyundai.
Shares may drop further
Retail investors have bought Hyundai Motor and Kia shares worth roughly 915.7 billion Korean won ($817 million) and 798.8 billion won (about $713 million), respectively, since the Jan. 8 speculation over a potential collaboration with Apple, according to Sung Yop Chung, regional head of automobiles and components at Daiwa Capital Markets.
"Following the negative vibe from both (Hyundai Motor) and Kia's filing this morning, highlighting that there is currently no EV cooperation with Apple, worst-case suggests that Kia's shares could correct as much as 31%," he told CNBC's Chery Kang. Â
Apple is known for putting a lot of premium on secrecy but the news of a potential collaboration with Hyundai was still leaked through local and international press, Chung told CNBC's "Street Signs Asia" on Monday. "I think Apple was probably not happy because of that."
"From Hyundai's perspective and Kia's perspective, I mean, there could've been a bit of a conflict of interest," he said. "They don't really want to just become a subcontractor of Apple, I think they were looking to sort of gain from Apple's strong capabilities in software."
Chung explained that it was still possible for both sides to revisit the deal at a later date as Hyundai said in its regulatory filing it was in talks with multiple companies.
"I wouldn't say that this is the end of it, I would say it's a temporary halt if you like for the negotiation between the two groups," he said.
Speculation about Apple getting into the auto business has been rife for several years but nothing concrete has materialized.
Some Wall Street analysts see the auto sector as a new market for Apple to grow into, but others caution against the reality of making an Apple-branded car as it could potentially mean heavy investments for low margins.
— CNBC's Chery Kang contributed to this report.