- New credible rumors indicate that Apple is more and more committed to its "iCar" project, with shipping now scheduled for 2021.
- Car making is more and more dependent on cutting-edge technologies developed by Silicon Valley companies like Apple.
- The recent deal between Uber and Didi Chuxing, in which Apple invested, has implications for the future of the iCar project.
The Internet is always full with rumors and speculations about Apple, Inc.'s (NASDAQ:AAPL) stealth car project, some more credible than others. While the project is often referred to as "Project Titan," more and more analysts consider the "iCar" as the "next iPhone," a major driver for Apple stock in the next decade.
Previously Amigobulls reported credible rumors that the Apple Car was ready for road testing at GoMentum Station, a former naval base in California, now a high-security testing ground for autonomous vehicles, and on track for shipping to consumers as early as 2019. In April Amigobulls reported about Apple developing Project Titan in a research and development lab in Berlin. The car, manufactured in Austria by Magna Steyr, a brand-independent automotive engineering and manufacturing contractor, would be all-electric like current Tesla Motors Inc. (NASDAQ:TSLA) models. While the iCar wouldn't be an autonomous self-driving vehicle at launch, future versions would be fully autonomous.
Now, according to credible rumors leaked by the usual "people familiar with the matter" and reported by The Wall Street Journal, Apple has chosen a senior and highly respected executive to oversee its car project. Bob Mansfield, who previously led hardware engineering for products including the MacBook Air laptop computer, the iMac desktop computer, and the iPad tablet, would be running the iCar project. In fact, earlier this month, employees at Apple noticed in the company directory that all the senior managers on the car project were now reporting to Mr. Mansfield.
As usual, Apple and Mansfield declined to comment. So far, the company has never acknowledged publicly that it is working on a car. It's interesting to speculate that leaking information without official statements or comments could be a deliberate pre-marketing strategy to build a powerful mystique around the iCar project.
According to leaks reported by The Information, Apple had pushed back the target iCar shipping date to 2021. It's worth noting that car making is more and more dependent on cutting-edge technologies such as electric energy storage, maps, navigation, computer-assisted driving, machine vision, machine learning and Artificial Intelligence (AI), where Silicon Valley companies like Apple have an edge over traditional car makers. It appears, however, that aspiring Silicon Valley car makers are establishing or investigating partnerships with traditional car companies for manufacturing and other conventional aspects of the business. This seems to be the case for Apple as well, as indicated by the partnership with Magna Steyr.
Apple needs to find new revenue streams because the traditional ones are drying up, and the company's traditional markets are reaching saturation: if most of those who want an iPhone have one, and the old models are still good enough, persuading consumers to buy their first iPhone or upgrading to a new model could be a struggle. It seems likely, therefore, that Apple is getting ready to bet on the iCar. While Apple is hardly the only company developing new, Silicon Valley-inspired visions for the car of the future, it's plausible that Apple fans could transfer to the iCar their addiction to Apple's products and brand loyalty.
In apparently unrelated news reported by Bloomberg Technology, Uber is selling its China operations to Chinese ride-sharing company Didi Chuxing. So far the two companies competed for the ride-sharing market in China, but now Uber will leave China to its strongest local competitor and focus its efforts elsewhere. As part of the arrangement, Didi Chuxing is reportedly investing $1 billion in Uber.
The link is Apple's $1 billion investment in Didi Chuxing, covered by Amigobulls in May. Now, through Didi Chuxing (the leading ride-sharing company in China), Apple is invested in Uber (the leading ride-sharing company in the world) as well. It seems plausible that Apple will be in a good position to equip both Didi Chuxing in China, and Uber worldwide, with fleets of iCars.
It seems that Apple has seen the writing on the wall - sales of its current top selling products could slow down - and started to build a new business line in the automotive sector, ranging from iCars to the fast-growing ride-sharing economy. Investors should rest assured that Apple is sensibly investing in its future, and continue to bet on Apple's stock.