Shares of Apple rose in morning trading on Tuesday, a day after Reuters reported that the world’s most valuable company aims to produce an “Apple Car” by 2024 with its own revolutionary battery technology.
Central to Apple’s strategy is a new battery design that could “radically” reduce the cost of batteries and increase the vehicle’s range, Reuters reported Monday, citing a “person who has seen Apple’s battery design.”
Gene Munster and Andrew Murphy for Loup Ventures:
While the timing of an Apple car or a software licensing approach for traditional automakers is hard to predict, we continue to believe it’s likely Apple has a business related to autonomous vehicles in the next decade.
Regardless of their approach, it is clear to us that Apple has ambitions in the transportation space, which could result in meaningful revenue for the company, the emergence of Tesla’s first true competitor, and further evidence that traditional auto is in a tight spot, absent any partnership with a tech giant.
The bigger question is whether Apple will have a car on the road ten years from now. We continue to view this as a likely scenario, given Apple has invested in mobility for the last seven years, and the auto market is massive and at the cusp of a transformation. This is Apple’s wheelhouse: find a big market that a competitor has already made progress in, enter the market a few years later, and revolutionize it.
Why would Apple build a car?
• Large addressable market as cars become computers on wheels.
• Design.
• Apple knows the anatomy of the future car.
MacDailyNews Take: In their full article, Munster and Murphy make a good point about Apple, or any tech company having to get comfortable with the fact that there will be accidents, people will die, and there will be negative press, so the company may be reluctant to build a standalone car given this fact. The reality is that cars are dangerous – in the U.S., 36,120 died in motor vehicle accidents in 2019 – but technology is making and will continue to make them safer.