Sidebar Sidebar
Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.

Former GM CEO on Apple Car: 'They Have No Idea What They're Getting Into'

MacRumors

MacRumors

macrumors bot
Original poster
Apr 12, 2001
68,257
39,058



danakerson-250x188.jpg
Amid rumors that Apple is developing an electric vehicle, former General Motors CEO Dan Akerson has shared his opinion on Apple's plans, suggesting the Cupertino company avoid getting into a business with such low margins.

In an interview with Bloomberg, Akerson said that Apple may be underestimating the difficulty of operating in the car business, as it's hard to navigate regulatory and safety requirements. "A lot of people who don't ever operate in it don't understand and have a tendency to underestimate," he said
"They'd better think carefully if they want to get into the hard-core manufacturing," he said of Apple. "We take steel, raw steel, and turn it into car. They have no idea what they're getting into if they get into that."
Click to expand...
According to Akerson, Apple should stick with the iPhone, which has much higher margins than a car and none of the issues with safety. As highlighted by Bloomberg, while Apple made $18 billion in December with a gross margin of 39.9 percent, GM made just $2 billion with a gross margin of 14 percent.

Akerson doesn't believe Apple should get into the car business, but he does admire Apple's entrance into the car infotainment arena with CarPlay. Speaking on his time as CEO of General Motors, Akerson said that he absolutely would have partnered with Apple. "I'd have turned over the infotainment and interconnectivity of every car."

News of Apple's electric car plans surfaced last week after The Wall Street Journal shared details on a secret project at the company. Apple is said to have hundreds of employees working on the car in a secret research lab near its Cupertino headquarters. The car, which is electric, could potentially resemble a minivan.

Article Link: Former GM CEO on Apple Car: 'They Have No Idea What They're Getting Into'
 
Article Link
https://www.macrumors.com/2015/02/18/former-gm-ceo-on-apple-car/
Apple has almost $200 billion in cash....GM had to be bailed out by the tax payers.

Apple knows precisely what it's doing.
 
Is it just me, or does this guy bear an amazing resemblance to Steve Ballmer?

If I could only achieve a 14% margin, I wouldn't be lecturing others how to do things better.
 
MacRumors said:
[url=http://cdn.macrumors.com/im/macrumorsthreadlogodarkd.png]Image[/url]


Amid rumors that Apple is developing an electric vehicle, former General Motors CEO Dan Akerson has shared his opinion on Apple's plans, suggesting the Cupertino company avoid getting into a business with such low margins.

In an interview with Bloomberg, Akerson said that Apple may be underestimating the difficulty of operating in the car business, as it's hard to navigate regulatory and safety requirements. "A lot of people who don't ever operate in it don't understand and have a tendency to underestimate," he saidAccording to Akerson, Apple should stick with the iPhone, which has much higher margins than a car and none of the issues with safety. As highlighted by Bloomberg, while Apple made $18 billion in December with a gross margin of 39.9 percent, GM made just $2 billion with a gross margin of 14 percent.

Akerson doesn't believe Apple should get into the car business, but he does admire Apple's entrance into the car infotainment arena with CarPlay. Speaking on his time as CEO of General Motors, Akerson said that he absolutely would have partnered with Apple. "I'd have turned over the infotainment and interconnectivity of every car."

News of Apple's electric car plans surfaced last week after The Wall Street Journal shared details on a secret project at the company. Apple is said to have hundreds of employees working on the car in a secret research lab near its Cupertino headquarters. The car, which is electric, could potentially resemble a minivan.

Article Link: Former GM CEO on Apple Car: 'They Have No Idea What They're Getting Into'
Click to expand...


Phone industry incumbents all over again - circa 2007. We'll see.
 
Really?

How about working on getting your phones and computers/OS's squared away first.
 
Apple wouldn't have wanted to partner with GM - its vehicles are hardly innovative.
 
Can someone find a quote from Nokia in 2005 or 2006 saying Apple shouldn't get into the phone business, they have no idea what they're doing?
 
This coming from company that had to get help from the government? Yeaaaaaaaaaaaaaaaaaaaa...

a lot more quotes from top executives in the automotive industry in the coming weeks.......personally, I think they're scared out of their mind
 
zedsdead said:
Apple has almost $200 billion in cash....GM had to be bailed out by the tax payers.

Apple knows precisely what it's doing.
Click to expand...

Not when it comes to cars. And he's right, the iPhone makes way nicer margins with less risk.

Also: "Akerson said that he absolutely would have partnered with Apple. 'I'd have turned over the infotainment and interconnectivity of every car.'" Sounds like a good guy to me (unless he's just BSing). Everything Apple and even Google make are far better than anything in any car. Yes, even the Tesla system sucks in comparison.
 
"We take steel, raw steel, and turn it into car."

Haha, seriously? Apple takes an abundant amount of materials and makes the most advance and revolutionary technology of our day. Not that it matters if they are marking a car or not, but they make some awesome products.
 
bsforever said:
Phone industry incumbents all over again - circa 2007. We'll see.
Click to expand...

My same thought. Exactly the same things that were said about the iPhone. These people have been so entrenched in their own way of thinking for so long that it's almost incomprehensible that someone from outside of the industry could do the same thing and do it better.
 
LOL laughably reminiscent of what phone company execs said ahead of the iPhone. And that too was a low margin business -- back then.

And wow, like, they make cars out of STEEL?! Holy crap! If only Apple, say, I dunno -- had some experience pioneering manufacturing techniques around the use of metal, say, I dunno, aluminum...

:rolleyes:
 
"We’ve learned and struggled for a few years here figuring out how to make a decent phone. PC guys are not going to just figure this out. They’re not going to just walk in."

Palm CEO Ed Colligan, November 16 2006
 
He doesn't know what he's talking about...15 years ago yeah it was a difficult business to pursue due to barriers of entry.

But now with modernization of factories and technology advances it makes entering the car scene much easier. This former GM CEO is just scared that other competitors will knock Detroit out of the game.

Its time for revitalization of the car industry, a technology driven company will only make newer vehicles better.

I freaking love when companies take risks, Tesla is a perfect example - I can't wait to get my hands on a Model S. I sure hope Apple gets involved so they can diversify their portfolio.
 
zedsdead said:
Yeah, just like they didn't know how to build phones either.
Click to expand...

Before the iPhone came out, we didn't know if they could build phones. But we did know they could build iPods, which were somewhat close, or at least closer than a car. This would easily be the biggest leap Apple has ever made.

Also, last time, they had Jobs.
 
Last edited:
zedsdead said:
Apple has almost $200 billion in cash....GM had to be bailed out by the tax payers.

Apple knows precisely what it's doing.
Click to expand...

I knew this would be the first post. And I am so disheartened to be proven right.

Just because Apple has billions in cash from successful products, does not have any correlation whatsoever to their ability to enter a new market (both new to them and to industry as a whole) without making mistakes. I'd like to point out that in no way do I think Apple should avoid the sector, as the GM former CEO states, because as a company devoted to quality, and who has tons of resources ($$$), they'll be hopefully able to do it justice. But just because they have the means to toy around with the idea of a car, do extensive research, etc... doesn't mean they know exactly what they're doing. Generating billions of dollars in profit on consumer electronics doesn't indicate they know how to make a car.
 
i love apple, i love all their products i think they're great and reliable but am I the only one who agrees with this guy? Apple had issues and still has issues with their maps app and they want to get into the auto industry... I think they're in over their heads. At the same time id love to be proven wrong
 
You must log in or register to reply here.
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.
Top Bottom
Back