Apple Car speculation returns. This is what we know so far

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The conversation about the iPhone maker’s ambitions to enter the auto industry has been spinning for about five years. Expectations of the effort, called Project Titan, range from the company that develops its own Apple brand car for supply of operating system software to existing vehicle manufacturers.

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

“There are so many things going on [electric and autonomous vehicles] and connected technology, “analysts wrote.” It is perhaps the right time for the world’s most valuable company to play its hand in the $ 10 trillion global mobility market. “

Apple has kept the mother his car ambitions and the company did not respond to a request for comment on recent reports.

Although Apple is famous in terms of the design and manufacture of firepower and it is up to cash, cars are a very different and lower margin business. Still, coming from behind in a new market has been the MO of Apple: Apple did not invent the smartphone, for example, but he created an innovative, clean and easy-to-use design that revolutionized the space and helped it dominate the market.

This is what we know about the possible Apple car.

Why would Apple make a car?

Electric vehicles are a booming industry, and the excitement around them reached a new high in 2020. Electric vehicle companies have seen their stock prices and fundraising dollars grow by healthy way this year, in contrast to the many companies suffering from the 2020 pandemic.

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

It is possible that Apple is also seeing the rapid growth of Tesla, the world leading producer of electric vehicles. (CEO Elon Musk recently tweeted to Apple Cook CEO 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 for comment).
Elon Musk claims that Tim Cook refused to meet with him to discuss the purchase of Tesla
Tesla’s market cap has risen to more than $ 630 million – after shares soared 682% this year, which is worth more than the combined market value of most of the world’s top carmakers. Given that car development usually takes four to five years, now Apple could be enjoying the gas to make sure it can be a viable competitor to Tesla.

“If they keep waiting, could Tesla go so far that Apple could never play to catch up?” Tom Forte, a DA Davidson analyst, said.

Some experts think Apple is more likely to partner with one or more automakers sell a car operating system, autopilot software, or other related technology, rather than manufacturing the entire vehicle.

“The partnership probably makes the most sense,” said Mike Bailey, research director at FBB Capital Partners. “The only issue I’ve heard is that cars may be less profitable compared to Apple’s other products, so it’s worrying whether Apple will shift gears to a less profitable line of business.”

Tesla took years to make a profit and released its first annual operating profit in January 2020 after nearly a decade as a public company.
Produce 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 inconsistent growth in sales of its largest revenue engine, iPhones, in the last years.
Building autonomous cars could also create more time for people to use their iPhones, other Apple devices and Apple services. According to Morgan Stanley analysts, around the world, drivers and passengers spend 600 billion hours inside cars annually. Among the patents related to Apple’s car: a virtual reality system that could help passengers work in a car without movement problems.

“If you look ahead, it’s hard to see Apple’s car as the next big thing in the way, for example, the cloud has been for Microsoft and Google. But again, no one really saw the cloud, ”Bailey of FBB said. “That might be really interesting for Apple, but it seems like a long thing.”

Wait, car-related patents?

Apple has been granted 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 of the electric vehicle was set in motion
Apple has also struggled to protect car-related intellectual property. In 2019, the FBI he accused two Chinese nationals working for the company of stealing trade secrets from their car project. Apple said in a lawsuit that the exposure of confidential material would be “enormously harmful.”

Who is working on the project?

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

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

Field joined Apple in 2018, according to its LinkedIn page. CNBC reported in January 2019 that Apple had fired 200 people from the Titan Project; Apple at the time only shared a statement describing a staff reshuffle involving workers moving to other computers.

In short, the exact size and makeup of the project are unclear.

What’s next?

In the short term, analysts say Apple is likely to have some more urgent priorities, such as building the ecosystem around its iPhone 5G and increasing its health efforts.

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

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

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

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