“If Detroit’s top brass are operating with the same acumen as former General Motors CEO, Dan Akerson, Apple should be tripling their car efforts,” Mark Reschke writes for T-GAAP. “Apple taking on Akerson and other automotive ‘wiz kids’ may make former Motorola & Microsoft CEOs (Ed Zander and Steve Ballmer) look like a genius.”
They’d better [understand the automobile industry] if they want to get into hard-core manufacturing. We take steel, raw steel, and turn it into a car. They have no idea what they’re getting into if they get into that. – Dan Akerson, former General Motors CEO
“If the iPhone giant chooses to focus its financial war chest, creativity and technology prowess on the auto industry, Apple will turn the market upside down. Apple will not build a car like the current automotive market, rather, they will build a car like no one has seen before — from design to the manufacturing process, it will leapfrog the market,” Reschke writes. “GM, Chrysler (Fiat) and Ford had better pray that Apple finds something far more interesting to focus on than consumer transportation.”
Read more in the full article here.
MacDailyNews Take: Ooh, not just steel, but raw steel. How will Apple ever figure that out?
It took Detroit’s collective genius approximately two decades to realize that festooning their shiteous jalopies with all manner of chrome doodads was passé. Jony Ive and Marc Newson would annihilate the lot of them with ease.
We’ve learned and struggled for a few years here figuring out how to make a decent phone. PC guys are not going to just figure this out. They’re not going to just walk in. – Ed Colligan, Palm CEO, November 16, 2006
Related article:
Apple hairball? Ex-GM CEO says building cars may not be worth it – February 18, 2015
I’d tend to think that an Apple Car would be competing with BMW, Mercedes and Tesla before Ford, GM and Chrysler.
Kind of like “competing with Android” ?
I don’t think so… I’m sure there will be high end, but I think Apple will want to reach a larger audience than just the customers of BMW, Mercedes and Tesla.
Here’s the funny thing about Apple – their competition is irrelevant to them. They make the finest product and experience they can, and the customers come to them (in droves) – and that’ll include some people who would have been expected to buy at the lower tier but who are willing to extend themselves to be part of the Apple experience. They might buy a Vizio or Insignia TV instead of a Sony, but they’ll buy an iPhone instead of a Samsung or HTC. And they’re buying more Macs than ever, instead of settling with lower-cost Dells, Lenovos, etc. Even if they have to sacrifice some things to make it work.
Cars are different, yes – lots more money involved – more than a few extra days work at the office/plant. But if Apple gets there in a compelling fashion, with attention to detail and the user experience, a surprising number of people will buy it – and at Apple’s large margins, they’ll do quite well. After all, if they try to compete at the low end (which they’ve never done), they’d lose their cachet for the high end, and those margins would no longer work their profit magic.
yeah but they means those brands have a big disincentive to add CarPlay to their cars. I want CarPlay in my new BMW more than I want an Apple Car ;-(
“people don’t know what they want until we show them, that’s why we don’t do focus groups.” – Steve Jobs
“We take steel, raw steel, and turn it into a car.” WRONG. They design and engineer components that make a car. They have a supply chain that takes the raw materials and builds the components which are assembled. Just like apple does but on a lager scale.IF Apple sees a way to make a high profit car (widget) they will do it. Just wish I was 31 instead of 61.
MDN has found the quote to iCal. “Apple had better understand the automobile industry.” The shaky assumption here is that the automobile industry understands and wants to satisfy peoples transportation needs. I need to get from here to there safely and simply. I need to not spend too much money doing it. I need to not be part of destroying the planet. I don’t need car payments or car dealerships. Got that Detroit.
Apple doesn’t need to understand the automobile industry, they want to understand peoples needs to get from here to there. Everything follows from that.
Exactly. As someone who has read Jony’s book, Dan Akerson’s statement is beyond batshit insane. Apple have rewritten the book in manufacturing, making high precision machined parts the benchmark.
He has been iCal’d in my calendar.
Poor Apple that little computer company that did not understand the music industry, or the phone industry, or the tablet computer market, and does not seem to understand the watch industry, but has torn through each of them like a wrecking ball. The last one is suffering huge disruption and poor stock performance even BEFORE the Apple Watch is even on sale. When will these clueless over confident jerks get it? We are watching a design driven company selecting their next target. Apple has only begun to disrupt markets, let alone come to the end of their innovation. Steve Jobs may be gone, but the company he built on design will live on LONG after he is gone. The entire company is design driven, it has become entrenched in its culture. All who underestimate this approach do so at their peril. They now have the capitol to continue to their drive. 1 trillion dollars? That will be in their rearview mirror in a blink. The R&D money they have to spend is more than the GNP of many countries now, it will yield golden fruit.
I can’t help but think Marc Newson and Jony are working on something that will dazzle us all…
You are absolutely right. Apple will do cars because its #2 executive and new #2 designer know they can do it, want to, and Steve Jobs wanted to.
The only question they have to answer is can they make the price/battery/charging ecosystem work.
Marc Newson’s “Ford 021C” was brilliant. I love the interior, rotating seats, etc. Everything about it looks simple and clean.
Expect something that looks like its from Minority Report or some other futuristic movie where artists got to design the cars.
I only hope that neither of those two was responsible for S.J.’s butt-ugly yacht :o)
They weren’t, that monster was designed by an up his own ass frenchman.
Can you imagine how bad a boxy shaped glass and aluminum car would look?
Apple Stores are beautiful, and a great inspiration for the new headquarters, but very poor inspiration for boats, cars and bicycles.
Looks like a bastardised Lada to me. Which considering the Lada was already a bastardised Fiat doesn’t help. Really can’t think how mock 50s/60s looks with added geek factor and gimmickry is really the answer to motoring needs.
Remember reading a book as a kid set in the future where their cars were like Model T Fords that hovered. Left me cold as does this.
I think a breakthrough is close… battery technology is screaming out for a disruptive technology to enter the market. Marc, Jony et al will come up with something astonishing.
Maybe Mr. Fusion isn’t such a crazy idea?
I think the whole thing is ridiculous, overblown and overrated.
Dead on.
Until it isn’t. 🙂
Please no. This is the dumbest thing I have heard in awhile. Apple car. God.
Right, maybe apple just recently hired those automotive execs including Mercedes Benz Vice President of R&D and assembled a “secret” 200 person team for the next gen iPhone. And the New York Times article last week where Jonny Ive said that he has always wanted to design a car was just meant to dissipate these “leaked” rumors. 🙂
“They’d better [understand the automobile industry] if they want to get into hard-core manufacturing. We take steel, raw steel, and turn it into a car. They have no idea what they’re getting into if they get into that.”
– Dan Akerson, former General Motors CEO
Similar shades of defunct Palm ex-CEO Ed Colligan!
““We’ve learned and struggled for a few years here figuring out how to make a decent phone,” he said. “PC guys are not going to just figure this out. They’re not going to just walk in.”
They better hope the rumors aren’t true. At the same time if they DO Apple would not be able to satisfy the entire car, minivan & truck buying public immediately.
Meh, I’ll keep my supercharged V8 thanks.
So if all this turns out to be vapor that started from some goofball writer, will they get fired or get a raise? I think a RAISE. All the extra millions of clicks is worth it, even if it makes you a total bonehead. lol
Apple’s not building cars. That has nothing to do with Apple’s current strategies involving OS X and iOS. Apple is looking to get deeply integrated into the automotive industry, especially in the infotainment and automotive computer systems areas. It may even be looking at battery technologies (scaled up from iPhones and MacBooks).
I just don’t see Apple building a car. It doesn’t fit into Apple’s four-legged stool.
“Current” is the keyword in your post.
Your post is off for the same reason every other “poo-poo” post on Apple’s strategies – only looking at what’s in front of you. Apple ALWAYS looks beyond that point.
I’m not saying they will release a car, but it’s too obvious right now that they have hired a ton of people who are knowledgable about building cars… This is no different then guesstimating Apple’s intentions of releasing a wearable after all the hires from the health, fitness and fashion industries.
Employees/expertise = Product
2 possibilities. Either they are actually working on a car or they’re playing poker with the auto industry. Getting Car Play into these cars could be helped along if the manufactures are frightened out of their skulls by the prospect of Apple bringing their own solution to market and bypassing them like they bypassed Motorola.
That can backfire if they think Apple’s serious about getting to cars when in fact they aren’t, and remove CarPlay integration.
Apple probably gleaned a lot of pre-iPhone insight when integrating with the Motorola RAZR, car companies might realize the exposure they’ve given Apple and want to avoid a possible repeat.
In such a scenario, CarPlay would still be available in aftermarket consoles, but that’s a much smaller customer base.
Do M$, Gaagle, and ShameSkunk have branded cars in the works? Are they scrambling to come out with a SmartCar first ? 😀
Forget the car making Detroit shudder in absolute fear, heck the fact that Detroit’s country is committing crimes against humanity and trying to be a threat to global security should have the entire country shaking in fear, either that or waking up and taking steps to return to a civilized state.
Then again maintaining an arrogant approach that the empire is not crumbling is also an option, not a viable one, but an option.
If turning raw steel into cars is the significant barrier to entry, they’re about to get schooled.
I hope the Apple car works better than the new iWorks or Yosemite. If not, I will stick with Toyota. It actually does just work!
That’s why Toyota stands behind every Prius they make,
it’s the safest place
http://www.edmunds.com/recalls/toyota.html
Only two minor problems with over 250,000 miles of trouble free service. Compare that to Yosemite. (Just check the 500 most recent reviews on the App Store).
Comparing an electronics mfg company (Apple) getting into the phone business to Apple getting into the car building business is a nonsensical comparison. This article is just plain ridiculous. I have no doubt that as a mobile platform, cars are a great market to pursue, but they don’t need to build cars to be in the mobile car business. Apple’s ability to design systems that users want and their ability to execute designs of world class quality puts them in a good position to be a substantial resource for many car makers. Microsoft tried this but failed to produce anything enviable. Harman Int’l does the best designs for multiple companies. Apple, no doubt could (if they applied the right resources) make a huge business out of designing highly integrated user-friendly car systems. But saying Detroit should be afraid? That’s silly. There are plenty of car makers (some from Detroit) that have already figured out that designing great infotainment systems in house is beyond their capacity.
For a typical car customer, 90% of a “experience” of owning and driving that car is the car’s “user interface.” And THAT is Apple’s area of expertise. Apple can contract the mechanics of an all-electric vehicle (chassis, motor, suspension, etc.) to a competent existing automaker, and focus (at least initially) on designing how the user (driver) interacts with the vehicle.
One other point of innovation that Apple can apply is power source. With an electric vehicle, power is stored in a battery. It is a simple design, compared to a vehicle with a combustion engine. How an electric vehicle’s battery gets recharged can be flexible, without changing the overall design of the vehicle. If it has an on-board small gas engine and tank, as the “power supply,” the car is a hybrid. The car can instead have hydrogen fuel cell. Or it can have an secondary battery to extend range, using the “plug-in” method to charge.
The “innovation” here is making it relatively simple to change the “module” that provides power to charge the car’s main battery. The car could be purchased as a hybrid, and easily changed to hydrogen power, if that fuel source becomes more convenient. All you’re “swapping” is how the car’s battery is charged. It would be in keeping with Apple’s existing strategy to have a small number of designs, with configurations based on the customer’s desires and needs. In contrast, most car makers tend to have distinct designs for each “type” of car.
All these car rumours, I don’t know. My first reaction is that it is simply extremely unlikely. But then I think more…
There was a great TV commercial about some financial adviser company that started with a chamber ensemble playing some classical music, all in their tuxedos. At one point a basketball lands next to the chair of one of them. He picks it up, spins it, passes it to another musician, they begin dribbling and next thing, they are in a pick-up basketball game like Harlem Globetrotters. The point of the commercial was how companies with agility are able to shift and change direction based on business trends. Blackberry died because they refused to let go of the keyboard (among other things). Detroit was bailed out twice by the government (first in late 70s, then again five years ago), when they refused to make smaller cars when nobody was buying the monsters they were churning out.
Apple is rapidly approaching saturation of global market for high-end smartphones. They will never go into the cheap end of the market. Instead, they have always been expanding into new product categories. I know a car isn’t the same thing as a phone, or a tablet, or a wrist watch. Still, the precise integration of hundreds of parts that go into Apple devices isn’t much different than the integration of parts that go into a car; they are just physically larger.
So, I’m still rather skeptical, but I wouldn’t be in total shock if it were to happen.
Apple’s Rumor & Vapor team outdid themselves on this one, with everybody talking like this is for real.
But Apple doesn’t do manufacturing (except for the low volume, relatively simple Mac Pro) and they have no special expertise in building mechanical contraptions. Not only would building a manufacturing facility take years, but including regulatory hurdles, it would tie down capital and management and squeeze out other projects even before the first cars were produced.
The distribution and support systems are also totally unlike anything Apple has attempted (basically every other product shares the same distribution and support channel).
So what would Apple bring to the product? A better stereo? A better steering wheel? They aren’t going to reinvent the internal combustion engine, nor have they hired enough engineers for any other far-reaching changes.
There is far more money in financing car sales and selling fuel to run them than the vehicles themselves. Making cars and trucks is a pain in the ass and a barely profitable endeavor for most in the business.
I have no doubt Apple is very interested in telematics and battery technologies. Just doubt they are stupid enough to go into the car biz.
Many companies have tried to compete with Apple thinking it was a music player builder, or a phone builder, or (soon) a watch builder. The ‘disruption’ Apple has brought to those markets is legendary because their competition just does not grasp that Apple is none of those. They are a design company melding beautiful design with high technology into their own ecosystem. The dorky looking Sony glasses are a prime example of what they are NOT. Were Apple to design a car, they probably would not build it. Other companies such as Foxcon, or others yet to be named would likely build it. The smart move would not to be to try to compete, but to try to be their prime contractor. To go back now and build a competing design driven company ecosystem would be a huge task, one I see NO ONE even attempting or even seeming to grasp.