Why on earth would Apple want to build a car? Apple wants to make money off of cars by selling devices and software that integrate with cars -- look at the hugely successful CarPlay -- but Apple is not going to manufacture their own cars.
From a business perspective, possibly because it's a huge market and Apple has a lot of cash to invest. It's quite different to what they currently do, but they are limited in how much they can expand in their current markets so they're probably going to want to try something new. Entering the phone market was pretty ambitious too (not as ambitious, but they were a much smaller company then), and they were prepared to take their time doing it. I believe precursor forms of the iPhone were in development for over 10 years before it was actually released.
I'm not going to say that Apple will decide to manufacture cars, or that they'd be successful at it if they did decide to. But I wouldn't rule them out either.
It's a huge market in term of sales but not profits. It's a terrible market to operate in - capital intensive, cyclical, cut-throat competition with low margins. It will suck billions to produce (maybe) a tiny fraction of the profits they make on phones.
It's not really a standard Apple play - take a new-ish technology and commoditise it, while wrapping it in pretty design and marketing glitter.
Making pocket/rucksack electronic doodads is one thing. Cars are on a completely different level of industrialisation, supply chain management, dealer networking, service support... and existing competition.
And the plausible market capture is much smaller.
It would be like Apple trying to compete against NEC, Fujitsu, and IBM with a commercial mainframe project. They could surely get a product out. But why? And then what?
> It would be like Apple trying to compete against NEC, Fujitsu, and IBM with a commercial mainframe project. They could surely get a product out. But why? And then what?
I think it's quite different. The car market is huge, and it's also a consumer market. Apple would struggle to make headway with enterprises, but they're good at consumer markets.
A lot of people would have said the same at the prospect of Apple competing with Nokia, RIM, etc in the phone world. And then they came out with a product that completely blew everyone away. A car is harder for sure, but they have the money and they also have the time so I don't really see why not.
The value of the car market is enormous. If you look at the top 10 industries, cars are the best market for Apple to branch out into. I can’t see them in financial services, construction, or oil/energy.
If you look at previous behemoth companies, like GE, they tried to hit all these industries and overextended. There was GE energy, GE Capital, GE digital, GE Healthcare, GE Transportation systems, GE Aviation, and some part of that made light bulbs. With Apple, they can’t just keep producing phones and grow so the challenge is to break into new neighboring sectors. Their goal with the car was not so much to manufacture it as it was to provide industrial design, branding, and software support as an initial foray. They were turned back by Kia/Hyundai as not bringing enough to the table.
As others mentioned, they already have huge financial services. Plus their mountain of cash is probably not just in some bank account, surely it's invested and put to work growing too.
Apple clearly has healthcare ambitions by the Apple Watch. They're building stupidly popular medical monitoring devices, and a health data research platform. Seems like they could tip-toe their way towards medical records management software too.
I am surprised they don't offer more cloud services for app developers, but i'm guessing its hard for them to compete with the major clouds.
Apple does not have the manufacturing or sales chops to sell whole cars. While Apple Geniuses are great at fixing an iphone, they're ill equipped to service cars.
Cars are becoming platforms for software and services, where the differentiation are those things, which Apple is good at.
Apple is so big, they have to look to giant markets to expand into.
At their scale, they should probably always 'be thinking about making a car' because the potentiality is so big, but being prudent enough to say 'no' almost all of the time. To the point that I think it's unlikely they will make one.
They partnered with Motorola just before the iPhone to dip their feet, so watch out for that one, i.e. the fully integrated Fiat, designed by Aplle or something.
Maybe they got suckered in by the "autonomous cars are only 5 years out" phase we went through a couple years ago, and figured they could sell rides, rather than cars? Not sure.
Maybe they just try everything because they have infinite money, and don't want to become the next IBM or Microsoft.
The same reason why Apple will probably make a TV even though they have AirPlay. They are different solutions to different problems. AirPlay and CarPlay are all about the iPhone and connecting it to a diverse ecosystem in another product category (TVs, Cars). It increases the value of the phone. Making a TV and making a car are stand alone products that answer the question: can we make a version of this product that is differentiated enough to be meaningful in the market? From a technology standpoint, this means clever integration of hardware, software and services. And beyond that, there are other things too (privacy, etc)
Apple isn't great at building low-value-add products. They shy away from these. TVs are a prime example where they can't add value beyond an AppleTV set top box.
- The set top box works with any TV and it's one SKU. The number of sizes/screen quality/prices that people would require from a TV is so not apple's MO. As much as apple loves integration, they'd prefer a one-SKU device more.
- Airplay is value, but they haven't really added to it lately. The existing AppleTV already does it, and so do 3rd party tvs.
- TVs are very low margin, and they don't own screen manufacturing so they're likely not able to take outsized profits from the market.
Regarding the Car
- Its an open question if they're still doing it, but maybe like the TV, they shouldn't wont...
- They want to control the software and GUI and that's done now. Unless they want to control the car itself (eg. doors, alarms, etc. or self-driving) they don't need deeper integration.
- Cars are very complex, even for apple standards - and not complex in the way apple is familiar with. They have no experience building or differentiating in this industry (like screens wrt to TVs but 1000x less experience).
- CarPlay added tremendous value, and most cars have it now. Deeper integration of the phone as the brains makes sense. But does anything else?
And they sell Apple TV devices, which when plugged into a TV with HDMI CEC controls (all of them nowadays), renders TVs indistinguishable from one another except for picture quality and maybe how quickly they turn on and off.
I guess it is possible for them to integrate the Apple TV device directly into a TV, but I do not see the profit motive on the part of Apple nor the convenience motive on the part of the TV user as it is pretty easy to stick an Apple TV onto the back of a TV.
Like I said, Airplay is a feature of an iPhone, not a TV product. The Apple TV set top box is a stop gap for a real tv. They need a placeholder platform to have the developer side of the platform seeded.
I disagree that the Apple TV is a stop gap. It works with any TV, and you stick some adhesive strips on it and stick it to the back of a TV, and the only difference is you need one more plug outlet for it.
Sony/LG/Samsung have plenty of low-mid-high quality TVs for whoever wants them. There is nothing extra Apple can provide there.
Thats exactly the problem. There is nothing extra Apple can provide. What if they want to use faceid for auth? They can't. If the TV is to be a platform like everything else, they can only push forward new APIs with new hardware. You are viewing the market is static.
You never have to interact with a
TV’s interface already.
HDMI CEC allows you to take a new TV, plug an apple TV in, and just use the Apple TV remote. The TV will automatically turn off and on switched to the Apple TV input, hence a dumb screen + Apple TV.
What happens when you have a ps5, xbox and/or switch attached to the same tv? is it seamless? Does it just switch on whatever remote you are using? what about first time setup?
People have been talking about the Apple TV for many, many years. This actually sounds like a stronger case for Apple not making a car.
> can we make a version of this product that is differentiated enough to be meaningful in the market?
FWIW, I think the answer is 'No', unlike e.g. AR glasses or smartphones pre-2007.
Heck, Apple TV and the homepod each are struggling relative to competitors and apple really hasn't delivered anything innovative in those spaces. Aside from truly wireless headphones, I can't think of any successful apple product that isn't primarily a computer.
We'll see. Just because people talk about products and they haven't come to light yet doesn't mean they won't. In fact, its probably more likely that people are just a bit wrong on the timing and not wrong altogether. If there has been talk of cars and tvs for so long, chances are they will make their way out the door at some point. Same went for the phone, ipad, etc.
Apple's Carplay may also be their first step in a 'automotive operating system' for partial or full self-driving cars. I could also see them building a 'development kit' car, with documentation to allow 'chassis-builders' and/or 'coach-builders' to create their own customized designs.
It makes sense from the perspective of Apple consistently being a "personal device" company. A car is another personal device. The more cars become imbibed with computing the closer they get to Apple's core interest.
Apple's margins are high not because its production costs are much lower than others, but because it has premium pricing. Average cost of a new car in close to 39k USD. How much more can people possibly afford? It's easy for Apple to take the market for 100$ phones and create a market for 1000$ ones. It is much harder to find a market for 390k$ cars.
Despite being completely “drive by wire”, (modern) cars are not just “computers on wheels”. For starters: cars have moving parts; Your phone doesn’t (or does but barely). They’re complex beasts.
Probably most folks would think Apple could build a car -- and something being a computer on wheels Apple could handle, its more like Apple probably doesn't like the economics of it.. iphones and software services are pretty lucrative, and worst case scenario you ask the person to bring in their phone to get a replacement.. when you scale that up to building service centers, paying mechanics, building huge factories that produce a small number of cars per day compared to the 1 million iphones per day it would be a losing part of the business in both profit margin and risk for years even if they end up being pretty successful with it eventually..
I dont know why you got downvoted. Servicing cars is very different from handling what Apple is currently selling and definitely not remotely the same. So it’s definitely a good question how or why Apple would enter the car market.
Designing the bits the computer actuates is not something you can model like a computer, though. Vehicle Dynamics isn't easy to get right. Tyres in particular might as well have been invented by Satan himself if you try to model them in a hurry.
Ford is positioning the electric F-150 as a power station on wheels. Run a table saw off your work truck. Run your camp site off your personal truck. Emergency power during the next flood.