[davidrm]

Apple has been in and out of the car game for a few years now, with executives coming and going. What I'm about to say will be as meaningful as this hear-say article, but I feel that Apple management, and its shareholders, have no idea what it means to build a car. Things like this need 100% commitment from the management, Cook just doesn't seem like the guy to do it.

[buzzerbetrayed]

> but I feel that Apple management, and its shareholders, have no idea what it means to build a car

I feel like people pretend that building a car is way harder than it actually is in 2020.

All the components to build a car are readily available. A person can buy the parts on their own and put them together in their garage. It isn't like they have to go get a pick axe and start mining ore to create everything from scratch. Apple just needs to buy the components that already work, and then do what they do best and perfect that parts that haven't been perfected. In this case, the battery, the motor, the onboard computer, and the software. And based off what Apple has built in the past, these are the things that Apple would be REALLY good at.

It isn't like they have to invent tires and drive shafts.

I know I undersold the difficulty of making a car in this comment, but come one, Apple is 87 times more valuable than Ford. They have enough cash on hand to buy Ford 5 times. Money might not solve all problems, but it really really helps.

[davidrm]

I work for a tier 1 EV supplier, I've spent 2 months in Hyundai's Namyang R&D center, several weeks at Aston Martin's facilities, and some others, you undersold it by A LOT. Ford, GM and other veterans on the industry have long lost their original spirit, just like any other company, but what they have is established processes and supply chain management, and that takes decades to do right. You can ship a 1st gen iPhone without a working camera, vehicle recalls hit you much harder.

[oblio]

And you need to supply parts for vehicles for almost a decade after the vehicle is no longer sold. At least in Europe.

[ksec]

>but what they have is established processes and supply chain management, and that takes decades to do right.

From my long time reading on HN, 99.99% of HN have absolutely zero visibility and knowledge on anything with Supply Chain.

I mean even the Web Industry and Programmers all jumped on to Cloud computing they dont have have the concept of "lead time" anymore.

[sixQuarks]

Elon Musk, the guy responsible for sending humans to the space station, a feat that has only been matched by the largest governments, stated that building modern auto manufacturing is harder than building rockets.

[the_duke]

Well, he did not say that building cars is harder than building rockets, but that "building the machine that builds the machine" is more difficult.

As in: efficient, large volume manufacturing and supply chain management. But that's obviously a very different kind of challenge.

He said the same thing about the new SpaceX rocket, Starship, which is supposed to be produced in large volumes.

[Drdrdrq]

And? Are you saying that Apple couldn't build rockets?

[root_axis]

Why would you think Apple is capable of building rockets? They have essentially zero aerospace expertise and that type of engineering is not at all in their DNA. Sure, they have billions of dollars to burn so it's within the realm of possibility, but it would be a very inefficient use of their cash.

[EduardoBautista]

Well, Elon Musk didn't have aerospace experience expertise either.

Neither did Jeff Bezos.

[sixQuarks]

Jeff Bezos started 2 years earlier with a much larger war chest, and has yet to send a rocket into orbit, let alone send humans to a space station.

[root_axis]

Sure... but SpaceEx is a company with laser engineering focus on essentially one goal for the last two decades, and they're only recently gaining traction on their ambitions, Apple would have an extremely steep curve to ascend before they could even hope to enter the "crash a bunch of rockets for research" phase. Apple just isn't built for this type of engineering.

[nickik]

Elon Musk started 20 years ago. So in 20 years Apple could of course build rockets if they wanted.

[regimeld]

Yup. Apple is closer to Ford and GM than it is to Tesla. Tesla is highly vertically integrated, and probably moving more so. Apple is much less vertically integrated. They design their products, but all their manufacturing is like others -- kinda like Ford and GM.

[bonestamp2]

> the onboard computer

Which one? I mean, even a Tesla has over 40 computers on the CAN bus. Cars may look simple when they just have a touchscreen interface, but they're really a small network of computers that can be driven. Engineering, and then building a car is really hard. Tesla has proven an upstart can do it, but they've been at it almost 20 years and Musk himself says it is very hard to build cars.

I'm sure Apple can do it if they put the resources in, but they're less than 1000 people deep at this point. 1000 people is a small department working on something you've never heard of at a large automaker. I don't even mean top secret stuff, I just mean day-to-day shit that most people don't think about, like drafting repair routines for each possible thing that can go wrong that someone in the field needs to fix in a timely manner. You take your car into get repaired and only 2-3 people may touch it, but that's nothing compared to the hundreds of people that worked on the information and software that those 2-3 people used to fix your car.

Not to mention the different software that is running in all of the 40+ computers in the car... or the hardware and software that's used to communicate with/diagnose problems with/update those computers.

Even after the car is engineered, it takes over a year to then engineer all of the tooling, equipment and processes that will be used to mass produce that car, put that tooling in place, configure it, test it, train people to use it, etc.

Modern cars are marvelous machines, and there's a nearly unbelievable amount of effort that goes into designing, building and repairing them.

[nickik]

Building one car and building millions of car is not the same thing. Car production, distribution and servicing is a totally different very localized problem.

Apple can do it if they really want do, but lets not pretend it is easy.

[wlesieutre]

The news about it recently was shuffling it back under their AI executive: https://daringfireball.net/linked/2020/12/08/giannandrea-tit...

As Gruber quipped - “This car is as smart as Siri” sounds like a threat, not a selling point.

[moogleii]

That's one way of interpreting it. I would venture that their public dabbling is indicative that that they do understand what it means to build a car, in the sense that car manufacturing shouldn't be underestimated.

Going all-in on something like this when you're not ready is just a waste of capital and nobody wants to be the next Fisker. Historically speaking, Apple has usually made sure all their ducks are in a row before launching something, whether it's going into processor design, audio, or launching a credit card. There's quite a bit of chess pieces that were put into position first, and a lot of that was done via hiring, acquisitions, and partnerships. That should demonstrate that Apple has gotten into other industries regardless of how much management or shareholders previously understood the problem. In other words, they seem to understand when they don't understand.

With BMW declining to be a partner all those years ago (allegedly), it makes sense to me that they would put their plans on the back burner. I'm still skeptical that they can (or want to) do this without a major manufacturing partner, but we'll see. Or, given how conservative they seem to be with their capital, maybe we never will. The AirPods Max project allegedly started 4 years ago, and those are just headphones.

[silentsea90]

I think Apple is one company I would trust with entering other verticals especially in the hardware space. While phones!=cars, I wouldn't put it beyond their team to deliver on this.

[buzzerbetrayed]

> I wouldn't put it beyond their team to deliver on this.

Or beyond their hundreds of billions of dollars in cash to hire a team needed to deliver on this.

[kube-system]

Their cash on hand is higher than the market cap of any automaker other than Toyota, Tesla, and Volkswagen.

They spent about 3/4 the market cap of Mazda to buy Beats.

[klmadfejno]

One could look to Apple's tv show catalogue as an example of them entering a new industry without much experience. They don't really have expertise in it, and it's probably suffering as a result. But then, they also have a ton of money to burn on it, so it's not without its merits. I think this will be very hard for them to do, and I think they'll look like they're making dumb mistakes for a while. But if they really want to go this way, they'll probably succeed in some form.

[amelius]

> Things like this need 100% commitment from the management

Then how can Elon Musk pull it off with only 50%?

[davidrm]

You could put me in charge and assuming I really go 100%, I doubt I'd pull it off. Point is, it also takes someone who really wants to and can do it.

Also, I'm just a guy on the internet, I really hope Cook sees this and decides to spite me and build an awesome car, I'm also a dreamer.

[bonestamp2]

He sleeps at the factory.

[DamnYuppie]

I don't disagree with you assessment. I feel like he could be able to forge a solid partnership with Ford as the move into the EV space. Also with Ford's(F) market cap of $34.89B Apple could vary easily just buy them outright if things go well.

[ghaff]

It seems like such an utterly different business. It seems as if there are so many more natural extensions in consumer hardware and software tech (as well as many not yet imagined). And I agree with your basic point that this is something that they'd almost have to set up as a separate company. And then you have to ask: "Does a well-funded EV startup sound like a smart business plan?" Maybe it does but it wouldn't be my first choice.

[_ph_]

I think most of all this shows how serious they are about the project that they keep pushing it despite potential setbacks. I don't think it says anything about the ability to build "a car" but rather, that they are still experimenting with finding the right product. Apple doesn't release a product until they think it is "right".

[randomsearch]

Maybe. Supply chains are his thing, though, so that works in his favour.

[friedman23]

Apple could outright buy GM or Ford with cash.

[lkbm]

Just did a quick check. Apple can buy GM AND Ford with cash, and still have nearly half their reserve left over. $191.83 billion cash on hand end of October[0], GM is 59B market cap[1], and Ford is $35B market cap.

I guess there is a premium you pay when acquiring a public company, but still astounding numbers.

[0] https://www.cnbc.com/2020/10/29/apple-q4-cash-hoard-heres-ho...

[1] https://www.google.com/search?q=GM+market+cap

[2] https://www.google.com/search?q=Ford+market+cap

[sixQuarks]

You're not factoring in debt. GM and Ford have a combined $300 billion in debt.

[asadlionpk]

But those would be terrible car companies to buy imo.

[buzzerbetrayed]

Do you have any reasons for this? Or thoughts on other car companies to buy. Apple does, after all, have enough cash to buy any car company besides Toyota (barely) and Tesla.

[nickik]

If you want to buy a company outright you need to pay more then the market cap.

[friedman23]

why? they have the experience manufacturing huge numbers of vehicles and apple has the experience manufacturing products with good experience and build quality. Get gm to build the drivetrain and the body to apple spec, apple builds the interior themselves.

[ucm_edge]

Why does Apple want the UAW contracts that come with any of the Big 3?

Tesla showed the preferable model (from the corporate perspective). Buy the factory (NUMMI), hire some of the ex-UAW workers, and go from there. They don't need the whole hog.

Plus if Apple really wants GM drivetrains, they can just buy crates them. GM's not going to turn down sales of any kind in this climate.

[kube-system]

They do have all the the ingredients, but they have a ton of financial baggage. Apple won't buy an automaker to manufacture cars, they'll contract it out for sure, the same way they do with the rest of their hardware.

[kansface]

Electric cars are really simple to make (Apple doesn't need the help). GM is a legacy business with a legacy business model selling dozens of indistinguishable cars via multiple competing dealerships. Its both terrible for customers and not compatible with Apple. The reason GM is priced so low is because its half obligations and dead weight. I would not personally want to bail out the doubtlessly billions of dollars of unfunded pension obligations of GM as an investment (ie, why should apple pay for the people who last worked at GM a decade ago?). Cleaning up that mess would take serious, distracting, decade long effort if its even possible.

Apple should poach the best employees from the industry, not the companies. They could probably straight up double everyone's salary and still pay less than SV engineers. I'd also look to buy out some manufacturers in the supply chain.

[bonestamp2]

> Electric cars are really simple to make

Simple compared to what? They're way more complex than anything Apple makes now.

[thefounder]

They will obviously offshore the manufacturing to China so it won't really be that hard to pull it off.