S.Korea's Mando in talks to supply parts for Tesla's Model 3 - source (updated)

HL Mando

24/05/2016 07:49

(Add analyst comments, background) 
    SEOUL, May 24 (Reuters) - Mando Corp  204320.KS  is in talks 
with Tesla Motors  TSLA.O  to supply parts for its Model 3 car, 
an industry source said, as it seeks to join other South Korean 
firms supplying components for Tesla's more affordable electric 
cars.  
    Mando, which makes steering, brake and suspension parts, 
currently supplies steering racks for Tesla's Model S vehicles. 
    The source did not give any details on the parts that Mando 
could provide for the cheaper Model 3, citing confidentiality. A 
Tesla spokesperson was not immediately available for comment. A 
Mando spokesman declined to comment. 
    South Korea's Maeil Business Newspaper reported on Monday 
that Mando had been picked by Tesla to develop and supply 
self-driving car technology and parts, pushing up Mando's share 
price.  urn:newsml:reuters.com:*:nL3N18K028 
    Asked for comment, a Tesla spokesperson in San Francisco 
said: "The rumours are not true. Tesla currently sources 
steering racks for its Model S vehicles from Mando. It does not 
supply autonomous technology systems." 
    Mando has two U.S. factories, in Alabama and Georgia, 
catering to demand from Hyundai Motor  005380.KS , General 
Motors  GM.N  and Chrysler. 
    By 2020, the company aims to generate half of its revenue 
from next-generation products, including semi-automated driver 
assistant systems, used in Hyundai Motor's Genesis G90 luxury 
sedan.     
    "Tesla is turning to South Korean parts makers, which are 
more cost-competitive than Japanese rivals, as the electric car 
start-up plans to drastically cut costs for the cheaper Model 
3," said Eim Eun-young, an auto analyst at Samsung Securities.   
    LG Display  034220.KS  and Hankook Tire  161390.KS  are 
among South Korean firms which plan to supply their products for 
the Model 3, sources have said.  urn:newsml:reuters.com:*:nL3N1742HT   
    Tesla has taken 373,000 orders for the Model 3 - which has a 
starting price of $35,000, about half the cost of its Model S - 
and has said it will begin customer deliveries in late 2017. 
 urn:newsml:reuters.com:*:nL2N18H03X 
 
 (Reporting by Hyunjoo Jin in SEOUL, Additional reporting by 
Alexandria Sage in SAN FRANCISCO and Dahee Kim in SEOUL; Editing 
by Richard Pullin) 
 ((hyunjoo.jin@thomsonreuters.com; 82-2-3704-5685; Reuters 
Messaging: hyunjoo.jin.thomsonreuters.com@reuters.net)) 
 
Keywords: MANDO CORP TESLA/