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Magna International Rises on Reports of LG Venture on Apple Car

Magna International reportedly will work with LG to help develop an electric vehicle for Apple.

Magna International  (MGA) - Get Magna International Inc. Report shares spiked on Tuesday as the auto-mobility-technology company is reportedly near a deal with LG and Apple  (AAPL) - Get Apple Inc. Report, media reports say.

Magna and LG are “very near to signing contracts” in a collaboration to produce an Apple Car, reports say.

Together the companies are set to work under the name LG Magna e-Powertrain to make early electric-vehicle models for the Cupertino, Calif., tech giant, a source told the Korea Times.

Apple and LG Magna e-Powertrain “will jointly establish relevant details for the production of the Apple EV, a prototype of which will be teased sometime in early 2024,” the publication added.

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The new company, held 51% by LG and 49% by Magna, is valued at $1 billion and will produce e-motors, inverters and onboard chargers, the Korea Times added.

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The transaction is expected to close in July, pending conditions including a vote of LG shareholders.

If it closes, the deal with Apple is expected to be small, due to Apple intending to produce only test-market vehicles for evaluation, Apple Insider reports.

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LG is expected to have an advantage since it's already an Apple supplier, the publication added.

Magna is based in Aurora, Ontario. It said it “would build vehicles at a plant in North America if contracted to do so,” the Korea Times reported.

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At last check Magna shares traded on the New York Stock Exchange were 4.4% higher at $93.44. Apple shares were trading 2.5% higher at $134.47.