Following tweets from Tesla founder Elon Musk on Tuesday saying that he’d reached out to Apple CEO Tim Cook in 2018, “during the darkest days of the Model 3 program,” to discuss the possibility of Apple acquiring Tesla for a tenth of its current value which followed, and were likely prompted by, a Reuters report on Monday that Apple is moving forward with self-driving car technology and is targeting 2024 to start production of a passenger vehicle that could include its own breakthrough battery technology, Bloomberg‘s Tim Culpan writes that Apple is Tesla’s “perfect nemesis.”
It was kind of inevitable that Tesla Inc.’s biggest challenger wouldn’t be a car company. Apple Inc. makes for the perfect nemesis and could teach its California cousin a thing or two about reliability and delivery…
Already, one thing Cook can do better than Musk is deliver a high-quality and consistent product on time. What’s holding Tesla back from growing into its $616 billion market value isn’t demand for its EVs, but inability to manufacture them.
Musk recently said that Tesla has “the high-class problem of demand being quite a bit higher than production this quarter.” That could be taken as a boast, but shouldn’t be. In effect, Musk is admitting that he’s leaving money on the table. The clear implication: Tesla might be good at designing but struggles at making EVs.
Musk fancies himself as the man who upended the automotive industry with an electric-only vehicle and direct-sales business model. Investors seem to think that warrants making Tesla the world’s ninth most-valuable company. But maybe the next true innovation in autos will pass him by as he clings to the fantasy that a car’s brand should also be its manufacturer.
Tim Cook looks ready to prove him wrong. This fight will be won on the factory floor.
MacDailyNews Take: Obviously, Musk’s tweets on Tuesday reveal more than a bit of apprehensiveness, which is well-founded, given that Apple generates Tesla’s annual free cash flow every 10 days.
The way the “Apple Car” will integrate into Apple’s ecosystem, along with Apple’s reported breakthrough battery technology and other innovative Apple-only features (Apple Glasses AR tech built into windshields, 5G iCloud connectivity, included services like Apple Music, etc.), will be things that no other vehicle will be able to match – and Musk knows it.