Apple to buy Tesla?

“Apple reportedly offered to buy Tesla at a price around $240 per share in 2013, said Roth Capital Partners analyst Craig Irwin on Tuesday,” Daniel Sparks writes for The Motley Fool. “The surprise news comes as the electric-car maker’s shares fell below $200 amid growing concerns from analysts covering the stock.”

“Though the bid was in 2013, recent pressure on Tesla’s stock price makes this news particularly interesting. After all, in 2013, Tesla was only delivering just over 22,000 vehicles a year. Trailing-12-month deliveries today, however, are closing in on 300,000,” Sparks writes. “If Apple really did consider buying Tesla at a higher price when sales were much lower, it would make sense for the tech giant to revisit the potential acquisition as the automaker’s stock slumps.”

“If there ever were a good time for Tesla to accept a buyout offer from Apple, today would be it. Shares have been under immense pressure recently, sliding nearly 30% over the past 30 days as investors fret the company’s big first-quarter loss and as a growing number of analysts make bearish calls on the stock,” Sparks writes. “The big holdup for Apple, of course, could be the capital-intensive nature of Tesla’s business that has made sustainable profitability look like a pipe dream to date. ”

Read more in the full article here.

MacDailyNews Take: Stranger things have happened… but never at the hands of Apple*.

That said…

A little birdie tells us that “a major Apple acquisition looms,” but that “it’s not yet a done deal.” If it goes through, however, “people will be shocked.” No further information was given. We’re unsure if “people will be shocked” at the name of company Apple may acquire, the size of the acquisition, both, and/or something else altogether.MacDailyNews, April 4, 2019

*Buying Beats for $3 billion is Apple’s largest ever acquisition.

Related articles:
Project Titan: Apple building large car drive rooms in California; made informal bid to buy Tesla at $240 per share in 2013 – May 21, 2019
Analyst: Apple will do a major media acquisition this year – April 4, 2019
Major Apple acquisition looms; ‘people will be shocked’ – April 4, 2019

26 Comments

  1. Buffet recently commented against this.

    Apple didn’t buy Netflix, they built their own.
    Apple is already building their own car.

    Famously, TSLA made all (?) auto patents open source in the spirit of sustainability – I’m not really sure what their true IP holdings are now – probably related to the design of their whizbang factories?

    1. Batteries and power management electronics. Those are the magic beans in an electric car.

      My guess is that Apple is very interested in Tesla but Timid Tim knows that Apple doesn’t have the culture and capability to manage a dirty, high capital, long term commitment kind of business that is at least an order of magnitude more complex than anything Apple has ever attempted…

        1. I’ve been saying this for five years now. Apple will never build a car or buy an automaker. Part of managing a profitable business is staying out of crappy business’. Apple is used to a 40% margin. Even if they double the margin of the average automaker, they will be at 20%. The is no way to make a 40 mark in the auto business, plain and simple.

  2. The existence of this article is proof that people would not be “shocked” by Apple buying Tesla. I also don’t see what Apple has to bring to Tesla except lots of money.

    Some more fun alternatives:
    AMD
    Intel
    Microsoft
    Some big bank
    Netflix is probably too expensive, but some other movie studio?
    Sony
    Canon.

    1. Here are some more:

      Dyson (Beyond vacuum cleaners they do digital motors, solid state batteries, electric cars.)
      IBM (Enterprise, AI, Data Centers)

    1. Come on, don’t be silly…. Apple updates it’s high end mac-pros every 5, 6 years, with no information in between. They are planning to take that into car model upgrades…

      It’s great!

  3. Tesla’s, errr, Elon’s arrogance blew it for Tesla.

    They have done a GREAT job with tech and conversion efficiencies. But they should NEVER have veered from their core competencies and tried to become a great manufacturer also.

    Rather, they should have done Apple to the car – outsourced the building of their product.

    The result of Tesla’s “Do it All!” approach is a company that builds sub-par constructed products, with sub-par internal materials, with out of control costs…

    Apple need no longer buy them. Rather, Apple is soooo far along with their own vehicle (CUV or Car…), they have no need for Tesla. And unlike Tesla, Apple will certainly outsource the build – almost 95% likely – to Magna Styr (which builds all of BMW’s MiniCooper brand, the BMW 5-series and many other cars for other companies).

    Will Apple be able to iPad the EV market? That’s the question.

    By this, I mean that Apple was expected to launch the iPad around $1,000 and stunned people coming it at $499, as Apple bet the farm on economies of high scale sales – and indeed won with that model.

    To do this with a vehicle would be absolutely amazing, but if any company can pull it off, it would be Apple.

    We shall soon find out…

  4. Tesla has the best electric cars on the market and fits Apple’s niche for quality products that control the high end of the market.
    Apple could bring better supply management to Tesla and make it profitable. Whether $35BB is worth it is another question.

    1. …. and after 120 years, the auto industry goes full circle:

      https://en.wikipedia.org/wiki/Lohner-Porsche

      I would disagree that Tesla has the best electric cars on the market. By some measures, sure, Tesla leads. Unfortunately, they have the total fit & finish and interior quality of a car that costs $20k less.

      Moreover, Tesla’s got new company. Rimac (a Porsche company) now has the highest performing electric cars on the market, with other luxury automakers all getting an EV on the streets or in development now. Competition is good for the consumer, but it will likely kill or acquire Tesla. Tesla appears to have exhausted the patience of its more-than-generous investors.

      Yesterday’s LA Times headline: “‘Dark Clouds Over Fremont’: Tesla enters survival mode as stock price drops”

      I predict that Apple has been approached by Tesla repeatedly looking for additional funding. It’s not clear how Apple would benefit. Also, Apple is too slow. A faster-moving company (GM, FIAT, Honda) will have snatched up whatever is left of Tesla before the most promising of Musk’s many follies sputters its last breath. Attempting to manage Tesla would kill Apple. Under Cook, Apple can’t walk and chew gum at the same time.

      1. “It’s not clear how Apple would benefit.”
        Don’t underestimate the appeal of the existing superchargers! Apple could buy the right for Apple cars to use the superchargers, e.g. as the only non-Tesla brand.

  5. If Apple were to buy Tesla they better not offer more than $10 a share because rumor has it that’s where the stock is going. the Tesla three is a piece of shit and carwashes won’t even take it because of they leak. It sounds like tesla would be the biggest waste of money.

    1. Whose rumor is that Ronny? Specific sources other than a “guy you know” or some third hand BS or were told by a guy named Ron.

      As of today I have yet to read a credible analyst or successful investment operation that seems to agree with that price target.

  6. No one will buy Tesla is Musk is part of the deal.

    At this stage he is an asset depleter and not an asset builder. Musk is an impediment to survival.

  7. Dear Tim Cook,
    Please focus on fixing the things your loyal customers have been patiently waiting for.. like for 6 years.. a new Mac Pro and Display that is priced fairly and updated yearly. Then fill the void of a smaller phone (4″). Then re-assess the need for an acquisition over building your own products with the talent around you, which is much less of an expense. For example, your beats acquisition was a terrible idea, and a huge waste of money. I would have created something better, hired even better faces for the product and utilized my resources. So, while I’m fine to an extent of acquisitions, just finish your own products that your customers have been waiting for first.
    Richard Hofherr

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