Apple’s Tesla Killer ($ TSLA) ($ AAPL) will not be shipped for at least half a decade

Photographer: Sam Hall / Bloomberg

Apple Inc. will take at least half a decade to launch an autonomous electric vehicle because development work is still at an early stage, according to people with knowledge of the efforts.

The technology giant based in Cupertino, California, has a small team of hardware engineers developing drive systems, vehicle interiors and external body designs with the goal of eventually shipping a vehicle. This is a more ambitious goal than in previous years, when the project focused mainly on creating an underlying autonomous steering system. The company also added more ex-Tesla Inc. executives to the project.

Still, some Apple engineers on the project believe the company could launch a product in five to seven years if Apple moves forward with its plans. The car is nowhere near the production stage, people said, although they warned that deadlines could change. They asked not to be identified by discussing sensitive internal work. Most of the team is working from home or the office for a limited time, reducing the company’s ability to develop a complete vehicle. An Apple spokesman declined to comment.

An Apple car would rival Tesla’s electric vehicles and offerings from companies such as beginner Lucid Motors and established manufacturers like Mercedes-Benz from Daimler AG and Chevrolet from General Motors Co. A key differentiator would be Apple’s ability to integrate its autonomous system, an expensive initiative that spurred the company to develop its own software, sensor hardware and chip technologies. The goal is to allow the user to enter their destination and be taken there with little or no other engagement, according to people familiar with the project.

Apple does not manufacture its own products and is likely to take the same approach with a vehicle. It is not clear which company would assemble the car, however. In its first attempt about five years ago, Apple worked with engineers at Magna International Inc., a major contract manufacturer in the automotive industry. Reuters recently reported that Apple plans to start producing a car as early as 2024.

Apple continued to investigate the construction of its self-driving car system for a third-party partner instead of its own vehicle, people said, and could, in the end, abandon its car efforts again in favor of this approach.

The company started building an electric car in 2014, hiring hundreds of hardware engineers for the effort before quickly reducing it around 2016 to focus on the autonomous car system. From 2016 to 2019, Apple cut hundreds of workers from the team. However, it retained some hardware engineers with experience in automobile components who stayed on the car design or worked on other initiatives.