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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The discussion of the iPhone manufacturer’s ambitions to break into the automotive industry has been swirling for about five years. The expectations for the effort, called Project Titan, vary from the company that develops its own Apple branded car providing operating system software to existing automakers.

An Apple car could be a “transforming event” for the automotive and mobility industry in the coming decades, Morgan Stanley analysts wrote in a note to investors last week – just as the iPhone changed the game for mobile phones.

‘There’s just so much going on [electric and autonomous vehicles] and connect technology, ‘the analysts wrote.’ This may be an appropriate time for the world’s most valuable company to play its part in the global $ 10 billion mobility market. ‘

Apple liked mom about its car ambitions, and the company did not respond to a request for comment on recent reports.

Although Apple famous for the design and manufacture of power, and it is full of cash, are cars a very different business with a lower margin. Still coming from behind in a new market is Apple’s MO: Apple did not invent the smartphone, for example but it created an innovative, clean, user-friendly design that revolutionized space and helped dominates the market.

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

Why would Apple make a car?

Electric vehicles are a growing industry, and the excitement surrounding them has reached a new peak in 2020. EV companies have seen their share prices and fundraising money grow healthily this year, unlike the many companies limping through the 2020 pandemic.

Analysts suspect that Apple and other technology companies such as Google’s Waymo want to take advantage of the opportunity – especially as infrastructure is expanded to support greater use of electric vehicles.

Apple can also see the rapid growth of Tesla, the world, lmanufacturer 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 did not want to meet. Apple did not respond to a request for comment.)
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Tesla’s market capitalization rises to more than $ 630 billion – after shares rose 682% this year, worth more than the combined market value of most of the world’s largest carmakers. Since car development usually takes four to five years, Apple can now hit the gas to ensure it can be a viable Tesla competitor.

“If they keep waiting, can Tesla run so far ahead of them that Apple can never catch up?” Tom Forte, analyst at DA Davidson, said.

Some experts believe that it is likely that Apple is collaborating with one or more people car manufacturers to sell a car driving system, self-driving software or other related technology, rather than manufacturing the whole vehicle.

“Partnership is probably the most meaningful,” said Mike Bailey, director of research at FBB Capital Partners. “The one problem I’ve heard is that cars can be less profitable compared to Apple’s other products. So it’s worrying when Apple’s shifting gears to a less profitable business line.”

It took Tesla years to become profitable and placed its first annual operating profit in January 2020 after nearly a decade as a public company.
Manufacturing a car, or even just an operating system, could be a new revenue growth for Apple, something the company has been working on following inconsistent sales growth from its biggest revenue driver, iPhones, over the past year.
Building self-driving cars can also create more time for people to use their iPhones, other Apple devices and Apple services. According to Morgan Stanley analysts, drivers and passengers spend 600 billion hours in cars annually. Among Apple’s car-related patents: a virtual reality system that can help passengers work in a car without getting sick.

“Looking ahead, it’s hard to see that the Apple car is the next big thing as, for example, the cloud was for Microsoft and Google. But no one really saw the cloud coming,” Bailey of FBB said. “It may be really interesting for Apple, but it looks like a long shot.”

Wait, car-related patents?

Apple has obtained many patents for a wide range of inventions for vehicles, such as systems for controlling the movement of autonomous (or partially autonomous) vehicles and methods for adjusting the transparency or opacity of car windows.
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Apple also fought to protect car-related intellectual property. In 2019, the FBI accuses two Chinese citizens working for the company of stealing trade secrets from the self-driving car project. Apple has said in court that the exposure to confidential material would be “extremely harmful.”

Who is working on the project?

A search on LinkedIn shows that Apple has hired experienced drivers, engineers and supply chain managers from Tesla, Google’s Waymo, Fiat Chrysler, BMW, Ford, Uber and other leaders in the automotive industry over the past few years.

Project Titan attracted talent such as Doug Field, who developed vehicles at Tesla, Ford and Segway, and Julian Honig, a former Audi designer.

According to its LinkedIn page, Field joined Apple in 2018. CNBC reported in January 2019 that Apple had fired 200 people from Project Titan; Apple at the time only shared a statement describing a staff shuffle in which workers switched to other teams.

In short, the exact size and composition of the project is not clear.

What’s next?

In the short term, analysts say Apple probably has some more urgent priorities, such as building the ecosystem around its 5G iPhone and improving its healthcare efforts.

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

“Do I think Apple could be a major competitor in electric, autonomous vehicles if necessary?” asked DA Davidson’s Forte. “Absolutely.”

Matt McFarland and CNN’s Sherisse Pham contributed to this report.

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