APPLE’S SELF DRIVING CAR
Apple’s secretive ‘Project Titan’ is again in the news with its plans to produce an autonomous vehicle by the year 2024
The Cupertino tech giant is considered somewhat of a beacon of innovation — not just because of its flagship iPhones, which are still revered as the best ones out there, but how the company has pivoted its business to providing other services. The company realized a few years back that the smartphone market is reaching a saturation point and decided to introduce other services to its lineup.
While the company’s core business model still revolves around the iPhones which bring in the most revenue, it has successfully ventured into other services. Last year, the company launched the Apple Card and its contactless payment system. More recently, it acquired a startup that would enable its iPhones to act as payment terminals. This is on top of its subscription music offering, Apple Music. Wearables are another important segment.
It was perhaps this reason that enabled Apple, which was the first publicly traded U.S. company to reach the $1 trillion market cap on Aug. 2, 2018, to also become the most valuable & the first $2 trillion U.S company this August. But the biggest surprise might be yet to come from Apple.
Most of you might know that Apple has been traditionally secretive of its upcoming products and services and the one we are going to talk about is one of them. If it does materialize, it could have major implications for the future of self-driving vehicles. Although the ‘Project Titan’ has been in existence since 2014, a recent report by Reuters that Apple is eyeing ‘next level’ battery technology has stirred up the debate again.
According to the report, Apple is moving forward with self-driving car technology and is targeting 2024 to produce a passenger vehicle that could include its own breakthrough battery technology. There has been a lot of back and forth ever since Apple started to design its autonomous vehicle from scratch. The company scaled down its efforts as recently as 2018 when Doug Field, an Apple veteran who had worked at Tesla Inc, returned that year and laid off 190 people from the team in 2019.
People familiar with the matter are now saying that Apple has progressed further with its plans to build an autonomous vehicle for the consumers. The latest plan includes a novel battery design that could dramatically reduce the cost of batteries and increase the vehicle’s range. The proposed unique “monocell” design bulks up the individual cells in the battery and frees up space inside the battery pack by eliminating pouches and modules that hold battery materials.
Although Apple might be the best-placed in the industry with the technology and deep pockets to dive deeper into this venture, one has to realize that it took Elon Musk’s Tesla 17 years before it finally turned a sustained profit, making cars. And there are a lot more variables that still need to be worked around Project Titan.
Talking about the autonomous vehicle pioneer, Elon Musk, who added a further twist to this story with his recent tweet (above)— first taking a jab at Apple’s monocell battery idea and then dropping an ever bigger bombshell saying that he tried to sell Tesla to Apple at 1/10th of the current market cap of $627.29 billion (at the close today). Apparently, Tim Cook declined to take the meeting. This might mean that Apple could seriously be on a path to potentially becoming a direct competitor to Tesla.
Reuters report also suggests that Apple might tap outside technology partners for other elements of the system, including “lidar” sensors, which help self-driving cars get a three-dimensional view of the road. Having said that, Apple’s iPhone 12 Pro and iPad Pro models released this year both feature lidar sensors and they can easily develop sensors from this internally developed tech.
What remains unclear, however, is who would assemble an Apple-branded car. Experts still believe that the company eventually might have to rely on a manufacturing partner. Experts believe it could be a challenge even for Apple to solely turn a profit-making automotive business — which demands volumes to be produced, utilizing a complex manufacturing network. Personally, I don’t think Apple cares about making a profit right away, with billions in cash and a loyal clientele at its disposal.
There is also the possibility that Apple might end up developing an autonomous driving system that would be integrated with a car made by a traditional automaker. After all, Apple has always focused on the software side of things for its other devices as well.
On the investing side, analysts believe it might be a good idea to own a bit of both Apple and Tesla in your portfolio, with reports of the companies going head-to-head in the self-driving, EV and battery markets. According to the trading App, Robinhood, these two companies feature as the most widely held stocks on the platform.
Apple has declined to comment on the report, but the plot around Project Titan has certainly thickened. What’s your take on it?