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Apple Aiming to Begin Electric Car Production in 2020
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As I usually buy cheap cars over 10 years old, I won't be looking to looking at getting an 
Car until 2030 at the earliest. 
Car until 2030 at the earliest. I was thinking we could chip in and carpet pool. All fly on a big one. That's if we're going to the same work place.
Remember when Apple made really nice, stable, reliable, high-end technology? I miss that. A hundred divisions and businesses is what companies do before they realize they bit off more than that could handle and decide to "get back to the basics." Wish Apple would skip the middle stuff and just go back to making nice, stable, reliable, high-end technology.
The profit margin is whatever you choose it to be when you have a product in a class of its own. If you want a Mac, or an iPhone, or any other Apple product to date, you can buy it or get out. There is no negotiating over the price. If you went into Apple's store, you're not interested in competing products. You'll pay whatever they ask.
That's how Apple has commanded the profit margins they do. They position themselves as being so much better than everything else that there are no competitors. Apple will probably take this to new extremes with the $4K Apple Watch, while their competitors are struggling to sell $100 watches.
So profit margin isn't something I look at when considering whether Apple will make a car. If it costs Apple $70K to make a car, they'll just charge customers $100K for it to maintain their margins (and I imagine people who are willing to buy it with a 2% margin, at $72K, are probably just as willing to buy it with a 30% margin, at $100K.)
At Apple's size, they have to move into other large revenue, large profit fields were they can provide what they sell. What they sell is : experience... Not tech. Tech is the means to this "product" they sell.
There is simply not enough money in the next few decade in the sector they're in to sustain the revenu/profit growth at their size eternally. That's why Wall Street is always giving them a low PE. If they were a much smaller company; I'd think that your argument is totally sound.
Large revenues fields world wide are (99% of top 500 companies are in those fields)
(80% in those 4 fields)
- Energy
- Financials / Insurance
- Telecoms
- Cars
(19% in the rest)
- Consumer Tech (Apple, Google,Amazon)
- Business Tech (IBM, MS,Accenture)
- Heavy/Specialized Tech (GE, Siemens, Honeywell)
- Pharma (Merck)
- Consumer goods (P&G)
- Retail (Walmart, Target)
- There is no chance Apple will get into Mass Retail, consumer goods or big pharma.
- Health care related equipment and home/business automation systems, (part of specialized tech) is a high possibility. Jobs had a big interest in health especially and it fits with Apple's vision statement.
- Business tech. This area were it is less about tech, and more about relationships/contracts/customization. The kind of customization is not really what Apple sells in their product, so that explains why its always had issues there. Their relationship with IBM could help smooth this out.
In the top 4 areas
- Apple is involved in the financial area by the side right now. Not sure if they'd want to be involved more. They seem to be happy to have just take a small cut and let the banks take car of the rest. Involvement in financials is used to bolster the rest of the ecosystem
- Telecoms is a mess right now, but unlike Google, I don't see what Apple could bring in this area (or what connecting users could bring to their business). Its a capital intensive area with entrenched competition. Can be a cash cow if you play the long game (though margins have eroded lately). Don't see Apple going there.
- Energy. Apple will get involved in this because of the increasing importance of battery tech (a core company focus) in the future, and it also fits the vision statement of the company to be involved in renewables.
- Cars, specifically electric cars. are not far away from their core experience. Battery tech is crucial to both their current product and to those cars. Cars provide an overall control on experience that is unparalleled.
I say go for it Apple.
What disruption beyond Tesla are they going to bring to the industry? Yes, the market is ripe for disruption, and Tesla is in the process of shaking everything up in it. They started designing their cars 12 years ago to get to where they are now. Once they release Model 3 (about 3 years away), I expect it'll be done. It'll be the point when historians look back and say, that's when the old model received its final death blow and began a 10 year tumble (takes awhile for old cars to go away. It'll be slow at first, but then pick up speed as gas stations become less common and it becomes increasingly inconvenient to own a gasoline based car.)
so.... no steering column=more room=thinner and lighter car. Using your iPhone to navigate a hairpin curve and mom calls.
It's been done. https://www.youtube.com/watch?v=qKAME9fAA-4
There are a few reasons I can see why they will/will not do this:
Will:
1. They can do a lot of thinking "out of the box" to make this truly different.
2. They have the cash to start up a company in a green field fashion.
3. They can put the car plant anywhere they want.
4. They have the supply chain management to do so (yes, we hear all the horror stories, but here, our ears are to the ground on this.)
5. A minivan? Sure! Families have a lot of money, and can afford one. If you're going for the Tesla crowd, you've limited your audience. Plus, minivans are used for a lot more than just hauling families around. I see them all around work as cargo vans. Imagine a van you don't have to have a driver for...
Will not:
1. Profit margins are low.
2. Too many regulations
3. A whole infrastructure needs to be developed for an electric car that is robust. Say, you're driving and forget to charge it. A regular car, you pull over to the side of the road and get gas. After 5 minutes of paying the guy to get you the gas, you're back on the road. OK, with an electric car, you run out of power. How long does it take to get a charge? This, I think is the problem with electric cars. It has to be better for people to switch, and all of the eco-greenery sales pitching will only convince a few people to plunk down $40,000 on a car that fulfills their dream. It has to be, at most, 15 minutes to fully charge the battery on the road, and maybe, an hour or two at home. There are technologies out there that need to be developed to make this happen:
http://hotair.com/archives/2013/02/23/video-the-battery-that-might-change-everything/
(The real danger is overvoltaging a capacitor. They blow up. For those that are not electronic engineers, a super capacitor and a battery can be used to power electronics. Batteries have attributes, like ability to hold charges for long times, and capacitors have the ability to charge quickly.)
4. Greenfield production is high risk. However, there can be a mitigation plan to make sure that the issues in the value stream are handled quickly and to the root cause.
5. Liability. If your self driving car runs over a bus stop with kids, who is at fault? You, the kids, or Apple?
Here is the last thing on reliability:
Your car works in the 99% range, and that means it is "broken" 3.65 days a year, including maintenance. It may be higher (99.5%?), but if a car has an availability of 90%, that means it's being fixed 1.2 months a year. Most people rely too much on their car for it to not be available, or have an easy mitigation plan ("go to the gas station and get some gas") for it to be viable.
It has to be better than what we have by a lot.
What are you talking about? Phones are even older than cars. Devices that store and play music are as old as cars. And people have been using tablets since the time of Moses.
Oh. You mean cell phones and digital music and computer tablets?
Well, Apple means electric, possibly self-driving cars. They're not going to try and build your father's Oldsmobile. It's not the same thing.
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The disruption will be complete when most of the cars you see are electric, self-driving cars. Or at least when seeing an electric, self driving car is no big deal. I've been driving hybrid cars for 15 years. It used to be that other people in hybrids would wave at me as they passed. One guy got out of his Prius at a stoplight and knocked on my window to ask me how I liked my Insight. I drive a Prius now, and it seems as though every third car on the road is a Prius. That's how I know the hybrid revolution is over.
I really hope this rumor is giving the people in Cupertino a laugh. Apple is a consumer electronics company not a car company. The auto industry is a tough business and the consequences for bugs are far worse than a spinning beach ball (just ask GM). Five years is a long time, especially with how fast the auto industry is advancing these days. Maybe Apple will design something that will blow our collective minds but it will be unprecedented for a consumer electronics company to enter the car business (I think)
I plan on using my Apple Car to go to the Apple Store to pick up my new Apple TV Set.
Because that would cost more than $35bn, and they wouldn't get something that is better than Tesla, more likely something less good than Tesla because usually after a purchase like that the energy is out of that company.
You can build quite an awful lot for $35 bn. That's 35,000 million dollars.
It doesn't work like that. When I buy a product, I don't care what margin the manufacturer makes. I care about what it costs, and whether it's worth the money for me. Whether I can afford it, and whether I can't get something better for the same money, or something a lot better for a little more, or something a little less good for a lot less money.
If Apple built a car for $70,000 and another company _sold_ (not built) a car that was exactly as good for $85,000, then I would buy the Apple car for $72,000, or for $80,000, perhaps for $87,000 if I like it better, but not for $90,000 or $100,000. What Apple's margin is, I don't care. What the other company's margin is, I don't care either. (All assuming that I can afford it and want to spend that much on a car).
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I agree, once you get good mileage, it would be a tipping point. However, how far you can go is only part of the problem:
As good as 400 miles/charge is, where can you fill up? How quickly can you fill up an electric car? With regular cars, gas stations are very common. Plus, it takes what? 5-10 minutes to fill an empty tank. I've heard electric cars take HOURS to charge from empty to full. Plus, here's the hitch: we all know how Apple loves proprietary connectors. I fear that if Apple does make a car, it'll need a proprietary charger. So good luck finding a place to charge. With an Apple brand, I'm sure gas stations or whoever will be willing to get the appropriate charging stations, but that would take months, if not years, after Apple announces it.
Apple is not building a car. They may be building components for cars produced by other manufacturers (e.g. sensors/self-driving logic).
You mean the consequence like the ignition issue that killed possibly 100 people and yet GM is still in business... The same GM that guy in another thread led for 4 years btw. Seems there are remarkably very few consequences for even mega mess-ups.
Pretty sure Apple has the money to hire top guys to make sure there is very few important "bugs". It is not like they need to reinvent the wheel too. Most car tech is well known and doesn't need Apple to recreate it. They just need to concentrate on the part of the car where they can make a difference.
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That's unlike Apple does everywhere else. Less likely than them building a whole car.
I disagree. Apple did not become a record label - they worked with existing record labels. Apple did not become a TV/movie studio or cable provider - they worked with existing studios and providers.
Apple is smart enough to know when it can create an industry (iPod/iPhone/iPad) and when it can augment an existing industry. This will be the latter.