Apple Car speculation is back. Here’s what we know so far

Apple Car speculation is back. Here’s what we know so far

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Discussions about the iPhone maker’s ambitions to enter the auto industry have been going on for about five years. Expectations for the effort, called Project Titan, vary from the company developing its own Apple-branded car for providing operating system software to existing car manufacturers.

An Apple car has the potential to be “a transformative event” for the auto and mobility industry for decades to come, Morgan Stanley analysts wrote in a note to investors last week – just as the iPhone changed the game for cell phones.

“There is so much going on [electric and autonomous vehicles] and connected technology, “wrote the analysts.” Perhaps it is the right time for the most valuable company in the world to play its hand in the $ 10 trillion global mobility market. “

Apple kept silent about its automotive ambitions, and the company did not respond to a request for comment on recent reports.

Although Apple is famous for its design and manufacturing firepower and is full of money, cars are a very different and lower margin business. Still, coming from behind in a new market has been Apple’s MO: Apple didn’t invent the smartphone, for example, but created an innovative, clean and easy-to-use design that revolutionized space and helped you dominate the market.

Here’s what we know about the possible Apple car.

Why would Apple make a car?

Electric vehicles are a booming industry, and the excitement around it peaked in 2020. EV companies have seen their stock prices and fundraising dollars grow healthily this year, in contrast to the many companies that limped during the 2020 pandemic.

Analysts suspect that Apple and other technology companies, like Google’s Waymo, want to take advantage of this opportunity – especially as the infrastructure expands to support greater adoption of electric vehicles.

Apple may also be looking to Tesla’s rapid growth, the world Ileading producer of electric vehicles. (CEO Elon Musk recently tweeted that he approached Apple CEO Cook about a sale to Apple during the early days of Tesla’s Model 3 program, but said Cook refused to meet. Apple did not respond to a request. comment.)
Elon Musk claims that Tim Cook refused to meet with him to discuss the purchase of Tesla
Tesla’s market capitalization has grown to over $ 630 billion – after the stock soared 682% this year – worth more than the combined market value of most of the world’s top automakers. Given that car development typically takes four to five years, Apple may be stepping on the gas now to ensure it can be a viable competitor to Tesla.

“If they kept waiting, could Tesla run so far ahead of them that Apple would never be able to catch up with them?” DA Davidson analyst Tom Forte said.

Some experts think Apple is more likely to partner with one or more car manufacturers sell a car operating system, autonomous software or other related technology, instead of manufacturing the entire vehicle.

“The partnership probably makes more sense,” said Mike Bailey, director of research at FBB Capital Partners. “The only problem I heard about is that cars can be less profitable compared to other Apple products, so that’s a concern if Apple is going to shift gears to a less profitable line of business.”

Tesla took years to become profitable, presenting its first annual operating profit in January 2020, after almost a decade as a public company.
Producing a car, or even just an operating system could be a new area of ​​revenue growth for Apple, something the company has been working to generate after the inconsistent sales growth of its biggest revenue generator, the iPhones, in recent years.
Building self-driving cars can also give people more time to use their iPhones, other Apple devices and services. Worldwide, drivers and passengers spend 600 billion hours in cars annually, according to analysts at Morgan Stanley. Among Apple patents related to cars: a virtual reality system that can help passengers work in a car without getting sick.

“If you look to the future, it’s hard to see the Apple car being the next big thing in the way that, say, the cloud has been for Microsoft and Google. But then again, no one really saw the cloud coming,” he said. Bailey, from FBB. “This may be very interesting for Apple, but it looks like a long shot.”

Wait, patents related to cars?

Apple has received many patents for a wide range of vehicle inventions, such as systems for controlling the movement of autonomous (or partially autonomous) vehicles and methods for adjusting the transparency or opacity of car windows.
2020: When the excitement about the electric vehicle went into high gear
Apple also struggled to protect the intellectual property related to the car. In 2019, the FBI accused two Chinese citizens who work for the company of stealing trade secrets from its self-driving car project. Apple said in a lawsuit that exposure to Confidential material would be “enormously damaging”.

Who is working on the project?

A LinkedIn survey shows that in recent years Apple has hired experienced executives, engineers and supply chain managers from Tesla, Google’s Waymo, Fiat Chrysler, BMW, Ford, Uber and other automotive industry leaders.

The Titan Project attracted talents like Doug Field, who developed vehicles at Tesla, Ford and Segway, and Julian Honig, a former Audi designer.

Field joined Apple in 2018, according to his LinkedIn page. CNBC reported in January 2019 that Apple fired 200 people from Project Titan; At the time, Apple just released a statement describing a team reorganization involving workers moving to other teams.

In short, the exact size and composition of the project is unclear.

What is the next?

In the short term, analysts say Apple likely has some more pressing priorities, like building an ecosystem around its iPhone 5G and stepping up its health efforts.

But the idea of ​​an Apple car remains a tempting possibility.

“Do I think Apple could be a significant competitor in autonomous electric vehicles, if desired?” asked Fort DA Davidson. “Absolutely.”

– Matt McFarland and Sherisse Pham of CNN contributed to this report.

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