Apple in Talks About Charging Stations for Electric Vehicles

[IJ Reilly]

Profitability for something as big as starting up a new car company is pretty much always a delayed gratification thing. Research and development, plus tooling up and building out manufacturing capacity are all enormous front-end expenditures. Nobody, including Apple is going to turn a profit on the first cars to roll off the assembly line, unless they sell for a few billion apiece. That's just not how it works.

Tesla's approach has been wise, I think. By starting with high-end models, they obliterate preconceptions about electric cars and make them something desirable. Then they work their way down to more affordable price-points with models that are still desirable and are made with expensive engineering refined and by this point actually made more affordable. So as model 3s get ready to hit the moderately-priced market, no one is looking at them as overly expensive, under-powered, mostly impractical environmental social statements. Instead, they hit a pre-prder sales record because they're cool, and not an expensive, personally inconvenient political statement.

Who knows what Apple will do? My guess is that they'll take some lessons from Tesla, and whatever car they produce, it won't be an ugly little bubble like the now-ubiquitous MotorTrend joke of a mockup.

More often than not, automotive company startup gratification is delayed forever. A lot of bleached bones out there, even those of companies that seemed to have everything going for them (e.g., Kaiser). Other venerable car companies failed not because they weren't making good products but because they were located too far from the crucial supply chains and consequently were unable to compete on price (e.g., Studebaker). This is why I believe it is almost certain that if Apple does this thing, their manufacturing will be outsourced to Asian companies with existing assembly lines. I sure don't see them going down the same path as Tesla. Whether their approach has been wise only time will tell. We know now only that they've been unable to deliver on promises and are seeing some major reliability issues with their existing fleet. The aura will wear off if they can't fix those problems pretty quickly if only because their competitors are coming on line in a hurry.

 

[billy the fish]

No, they are different. And?

Do you think selling ads to customers using google's search engine is the same as selling a self driving car? Similarly, no, they are different. And???

I think you have won the award for today's most baffling nonsensical reply.

The point being, that everyone saying it's a natural fit for Apple to go into cars cos they made an mp3 player, whoopee doo... so what, everyone can afford an iPod, they are a cheap product for the masses. No matter how wonderful an icar may or may not, their track record of turning industries on its head is worthless if the starting ticket price is north of 50k, there just isn't enough rich folk out there ready to stump up, just cos it's Apple. The watch should have told them that obvious news.

 

[Datalinks]

In other news the iPhone 7 will be identical to the 6 and the 4inch we were expecting is just a revamped iPhone 5. Focus Apple, focus

 

[JohnPhamlore]

Here's how Apple can flip the script on the auto industry. What Apple seems to be doing with its electronics is moving towards being able to claim a supply chain able to completely recycle devices.

Lease only cars, no ownership. Limited lifespan of maybe 5 years or shorter. Apple claims this is a feature, because with the rapidly changing auto industry, no one can predict the future a decade out, and it would be irresponsible to have a bunch of new cars made in 2018 or later stuck at old technology and holding back progress. Apple cars will thus continuously be recycled and thus continuously upgraded year to year.

And Tim Cook can use his supply management skills to tap into China's manufacturing base to make this happen.

 

[diamond.g]

They'd be profitable if they stopped building the infrastructure needed to succeed long term? That's no plan, it's a capitulation.

If Apple does build a car (still not totally convinced they will) then it will be interesting to see how their approach differs from Tesla, which has shown once again that, even with a lot of time and money thrown at it, profits in this industry can be highly elusive. It is certainly not in Apple's DNA to grind out product for five years before seeing results that can measured in earnings. They'd have to be thinking of a far different plan.

Oh I understand the long ter goal. I was just pointing out that (like Amazon) they are reinvesting all they are making into expanding.

More often than not, automotive company startup gratification is delayed forever. A lot of bleached bones out there, even those of companies that seemed to have everything going for them (e.g., Kaiser). Other venerable car companies failed not because they weren't making good products but because they were located too far from the crucial supply chains and consequently were unable to compete on price (e.g., Studebaker). This is why I believe it is almost certain that if Apple does this thing, their manufacturing will be outsourced to Asian companies with existing assembly lines. I sure don't see them going down the same path as Tesla. Whether their approach has been wise only time will tell. We know now only that they've been unable to deliver on promises and are seeing some major reliability issues with their existing fleet. The aura will wear off if they can't fix those problems pretty quickly if only because their competitors are coming on line in a hurry.

I would be interested in seeing that, very few cars are sold in the US at least that were mainly built [final assembly?] in Asia. I would be interested in seeing if Americans would reject Chinese made cars as well, even if they are designed to an American companies specifications.

 

[AZREOSpecialist]

Jobs used to say that Apple lives at the intersection of technology and the liberal arts. He said that many times. An Apple car has no such quality. What does a car have to do with liberal arts? Nothing. Apple has completely lost its focus and its product philosophy has been whittled down to the lowest common denominator and groupthink.

 

[IJ Reilly]

Oh I understand the long ter goal. I was just pointing out that (like Amazon) they are reinvesting all they are making into expanding.

Up to a point this is true. Amazon is plowing their profits into new products and services. They don't need to build the kind of manufacturing infrastructure that is essential to automobile manufacturing, as Tesla must.

I would be interested in seeing that, very few cars are sold in the US at least that were mainly built [final assembly?] in Asia. I would be interested in seeing if Americans would reject Chinese made cars as well, even if they are designed to an American companies specifications.

Likewise. It would be a massive experiment. China is the most likely manufacturing location, though I would not entirely rule out India or Korea.

 

[jerryk]

I wish apple would spend some of the $10B on getting a new Macbook pro to the market very soon. The current units are way behind the competition.

 

[Cwolk]

They should just have a contract with tesla. No way they're going to build all new ones. They don't even know 100% if they are even going to release the car. By the time they're certain, it'll be too late to start building new ones

 

[I7guy]

I think you have won the award for today's most baffling nonsensical reply.

The point being, that everyone saying it's a natural fit for Apple to go into cars cos they made an mp3 player, whoopee doo... so what, everyone can afford an iPod, they are a cheap product for the masses. No matter how wonderful an icar may or may not, their track record of turning industries on its head is worthless if the starting ticket price is north of 50k, there just isn't enough rich folk out there ready to stump up, just cos it's Apple. The watch should have told them that obvious news.

If you read some of the articles they have big plans for the watch more than a gear 2 competitor.