Phillip Elmer-Dewitt reports a note to clients from Guggenheim analyst Robert Cihra for Apple 3.0.
• We believe Apple needs big new [Total Addressable Markets] TAMs to keep growing and we reiterate our expectation that it ultimately launches a self-driving CAR, irrespective of contrary news flow and even its own hesitations to date.
• Apple is also investing in original MEDIA content as its other big new TAM, but we see cars better fitting its product-centric business model.
• We think consensus is that Apple has pulled back on ambitions to launch a car and is now just focusing on autonomous tech to sell to others, but we see no history of Apple acting as a “supplier” of core tech to other OEMs, and its entire business model rather built on owning/controlling the end-to-end experience.
• Given the market’s sheer size and parallels to Apple’s historical MO, we remain convinced that it will inevitably be drawn into launching its own car.
— Robert Cihra
Read more in the full article here.
MacDailyNews Take: Shhh! Apple doesn’t want anyone to think this just yet!
• I’ve always wanted to own and control the primary technology in everything we do. — Steve Jobs, October 12, 2004
• In order to build the best products, you have to own the primary technologies. Steve felt that if Apple could do that — make great products and great tools for people — they in turn would do great things. He felt strongly that this would be his contribution to the world at large. We still very much believe that. That’s still the core of this company. — Apple CEO Tim Cook, March 18, 2015
Apple’s autonomous vehicle fleet grows to 62 vehicles in California – May 29, 2018
Apple’s autonomous vehicle project may be closer to fruition than it appears – May 25, 2018
Google buys 20,000 SUVs, Apple gets two dozen VW vans – May 24, 2018
Volkswagen looks to Apple for electric-car design guidance – February 16, 2018
Apple said to develop car operating system in Canada – October 25, 2016
Apple scales back ‘Project Titan,’ effort no longer includes building own car – October 17, 2016
Apple’s Bob Mansfield reboots Apple Car project, lays off several dozen employees – September 10, 2016
South Korea company’s never-before-revealed battery technology expected to be Apple Car’s ‘secret weapon’ – August 9, 2016
Apple Car: Everything we know about Apple’s mysterious ‘Project Titan’ – July 29, 2016
Apple Car: An operating system licensed to other auto-makers? – July 29, 2016
Apple hires founder of QNX with Apple Car project increasing focus on self-driving software – July 28, 2016
Apple taps Bob Mansfield to oversee Apple Car project – July 25, 2016
Just buy Ford (market cap $45B), TESLA ($59B), or whoever.
TESLA seems overpriced but they are into other markets like solar and battery storage.
Tesla is bleeding cash and no one cares. If Elon smiles tomorrow the stock could go to $400. Apple could never get away with what Tesla gets away with in terms of financial loss.
“… but we see no history of Apple acting as a “supplier” of core tech to other OEMs…”
And what does this analyst think CarPlay is?
Before the iPhone Apple worked with Motorola to make the Rokr. They could go about cars in the same way.
True, but not the best example. The Rokr may be the abomination that convinced SJ that Apple had to do the iPhone itself in order to get it right.
I didn’t intend for it to be an example of why Apple should partner with other companies to let them release Apple tech. I was merely pointing out that it wouldn’t be without precedent if they first get their feet wet by developing car tech for other manufacturers, learning in the process, all before diving in with their own.
The Rokr was a huge failure for Motorola. Apple doesn’t need anything like that. However, whatever Apple does with cars they’ll never get a high valuation as Tesla has. Anything Apple does will be deemed a failure from the start. With Tesla, no matter what goes wrong, all those investors are always believing in a miraculous turnaround.
The final destination for Self-Driving Cars is “Networked Cars,” which is analogous to packet switching of data. Look up Kiva Robots on Youtube to see an example on a smaller scale. In this networked environment a car is just a “pod” that is moved from point A to point B. Whoever creates the “operating system” to control this network will have the real power. Tim Cook has alluded to this in his speeches, suggesting it’s the “greatest engineering challenge,” as you are linking next generation wireless communications, with on car sensors, and other factors . . . people who are focused on the idea of an “apple car” are missing the point that “the network” is the main thing.
Will be interesting to see.
Tesla found and realized a few things that car manufactures could improve upon in their current generation of vehicles – simply because they are not software-engineers at heart.
Building the equivalent of an engineering-sample is one thing, ramping-up production to a couple of millions is something completely different, as Tesla found out.
The US simply can’t do that. China could do it, Germany still does it (to a degree – production of German cars is now spread-out over the whole of Europe, with parts being shipped across the continent back and forth). In China, a lot of stuff seems be concentrated in one area.
So, if the Apple Car happens, it’s going to be built in China. If it’s a success, we’ll see yet another manufacturing industry move to China.
As for Apple buying Tesla: they’ll wait till he’s bankrupt and pick up the assets for a song.
They have hired enough people from him to know what’s really going on. I can imagine not too many players in the market being to keen on cleaning up any of Elon’s mess while he’s still around.
Elon is the kind of kind who can’t work for a boss. He has to be the boss.