- The Apple car project has been designated internally as a "committed project," the number of staff working on the project has tripled, and the target ship date has been set for 2019.
- Apple doesn't plan to make its first electric vehicle fully autonomous, but full autonomy is part of Apple's long-term plans for the car.
- Top investors and analysts are bullish on the Apple car project.
- Apple cars are likely to be priced higher than competitors' cars, but characterized by superior design, high performance and usability.
A few weeks ago Amigobulls reported that the much rumored Apple (NASDAQ:AAPL) self-driving electric car is ready for road testing and could be sold to consumers by the end of the decade. Now, The Wall Street Journal reveals that Apple cars could start shipping to consumers as early as 2019.
The self-driving car project, codenamed "Project Titan," has been designated internally as a "committed project," the number of staff working on the project has tripled, and the target ship date has been set for 2019, according to people familiar with the matter. As usual, Apple continues to keep the project under wraps and doesn't comment officially. "We look at a number of things along the way, and we decide to really put our energies in a few of them," Apple Chief Executive Tim Cook said on Stephen Colbert's talk show in reply to Colbert's question about the project.
Apple has an agreement for road testing with GoMentum Station, a former naval base near San Francisco, now a high-security testing ground for autonomous vehicles, and had meetings with California’s Department of Motor Vehicles focused on the autonomous-vehicle testing regulations that went into effect in September of 2014.
People familiar with the project said there is skepticism within the team that the 2019 target is achievable, and experts estimate Apple’s chances of shipping a car by 2019 at between 50 and 60 percent. However, the term "shipping date" is ambiguous and may refer to the date that engineers sign off on the product’s main features.
Expert analysts expect any Apple car to have three distinctive features: a unique design, the ability to work with other Apple devices, and some autonomous capability. In fact, Apple's car might not be entirely self-driving, but manually-driven with enhanced computer-assisted driving features and emergency self-driving capabilities. The "people familiar with the matter" said that Apple doesn't plan to make its first electric vehicle fully autonomous, but full autonomy is part of Apple's long-term plans for the car.
Apple might use the same outsourcing strategy that it employs for iPhones and iPads, where the company relies on off-shore contractors like Foxconn, and have important subsystems or even entire cars manufactured off-shore.
Forbes reports that billionaire business magnate and investor Carl Icahn is bullish on the project. "At $1.6 trillion, the enormous addressable market for new cars is approximately four times the size of the smartphone market," Icahn wrote to Cook. "We believe the rumors that Apple will introduce an Apple-branded car by 2020, and we believe it is no coincidence that many believe visibility on autonomous driving will gain material traction by then."
Goldman Sachs analyst Simona Jankowski agrees with Icahn that Apple is uniquely suited to tackle another primary consumer-facing product category. "The car, like the home, is another environment where Apple can add value via an operating system and increase the stickiness of its ecosystem," she wrote in a report.
Apple's main competitors are Google (NASDAQ:GOOG), which is accelerating the development of its self-driving car project, now headed by car industry veteran John Krafcik, and Tesla (NASDAQ:TSLA). While autonomy is a defining feature of Google's car, Tesla's approach is to add more and more autonomy in incremental steps to its successful electric cars product line. Tesla's approach is more similar to Apple's, and it's worth noting that Apple hired a senior engineer from Tesla in August.
Among the visionary, disruptive projects being pursued by top tech companies, highly autonomous electric cars are fast approaching operational maturity and commercial exploitation, and it seems likely that autonomous cars from many car makers will hit the roads soon. Like other Apple products, Apple cars are likely to be priced higher than competitors' cars, but characterized by superior design, high performance and usability. That's likely to win many customers loyal to the brand, as it happened for the iPhone, and push Apple's stock higher in the mid term.