Why Apple should not build an iCar

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Like Bigfoot and the Loch Ness Monster, Apple car rumors never seem to die. But unlike Sasquatch and Nessie, at least there have been several verified sightings of Apple testing its self-driving technology, albeit on production vehicles.

The idea of ​​an Apple car has been circulating since Steve Jobs’ death more than a decade ago, with company leaders and board members revealing the company’s venerable co-founder’s vague vision of entering the auto industry. But it is his successor and current Apple CEO Tim Cook who took over the reins of the legendary company and directed the development of a vehicle.

Cook gave the go-ahead to Project Titan in 2014 to build an electric vehicle and brought on board automotive industry veterans such as former Ford executive director Doug Field, fellow Ford engineer Steve Zadesky and North American R&D honcho. Johann Jungwirth from Mercedes-Benz – all of whom have since left.

Cook even flew to Germany in 2015 to meet BMW buyers, and Apple executives traveled to Leipzig to take a closer look at the production of the automaker’s i3 EV.

The iCar rumor mill took off last week when it was revealed that Apple had hired 31-year-old Ford veteran Desi Ujkashevic, the latest in a revolving door of car execs who have joined the company.

Google Cars

I won’t go into Project Titan’s tortured twists and turns, as it’s painstakingly documented by tech sites like AppleInsider. Suffice it to say, despite hiring — and losing — top automotive talent, Apple still isn’t making a car. And I believe it would be a huge mistake for Apple to build a car or even let others build it.

There are obvious downsides to getting involved in a high-cost, low-margin business that involves complex supply chains, the need to support legacy products with parts and services for decades, and the toughest regulations of virtually any industry. Compare this to Apple’s current dairy farm that develops and sells products and services with a highly controlled and controlled supply chain, a product life of several years with rapid planned obsolescence, and a relatively light regulatory burden.

With a market cap of nearly $2.5 trillion and an inventory of more than $200 billion in cash, Apple has the resources to launch an attack on established automakers — and even take on Tesla. The timing is right given the tectonic shift taking place in the auto industry, with the move to electrification rewriting the rules of engagement and the growing importance of software playing in Apple’s power.

But piles of money and technical expertise don’t translate into success in the auto industry. Just ask Google, which tried – and failed – to build its own car several years ago.

Pictured above, Google’s Firefly, purpose-built, self-driving car with no steering wheel or pedals was unveiled in 2014, and that same year, Google put together a starting list of auto suppliers including Bosch, Continental, Nvidia and Roush to sell 100 of the vehicles in one facility. Detroit.

While Google called Firefly “a test platform” for its self-driving technology, evidence suggests the company planned to mass-produce the vehicle. I spoke to Samir Salman, CEO of Continental’s North American unit at the time, and he indicated that the mega-vendor was working with Google to “provide our services and technical knowledge in components and in systems,” he said. “We supply braking systems, tires and body controller and interior electronics.”

But Waymo, Google’s autonomous vehicle technology subsidiary founded in late 2016, shut down Firefly and then bought tens of thousands of Chrysler Pacifica PHEV minivans and Jaguar I-Pace EVs. Since then, it has integrated its self-driving technology into its vehicles and has become one of the first companies to operate a fully autonomous ride-sharing service.

In 2018, Apple’s plans to build an iCar were cut back to a deal with Volkswagen to convert the automaker’s T6 Transporter vans into autonomous shuttles for employees at the company’s new Silicon Valley campus. But even that plan failed since VW invested $2.6 billion in Ford-backed Argo AI, with its new ID. Buzz’s electric minibus would then become a vessel for Argo’s self-driving technology.

Given all the highs and lows of Apple’s Project Titan, I’m surprised that the company doesn’t see car building as a quicksand money pit — and that it would be best to focus on providing much-needed software services to the car. industry a la Apple CarPlay.

But Google beat Apple with its Android Automotive OS, which is gaining momentum. Besides, as annoying as Tesla-Stans can be, imagine what it would be like to hang out with Apple Car fanboys and girls?