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Apple Targets Car Production by 2024 and Eyes ‘Next Level’ Battery Technology (Sources)

Apple is mum on reported plans to enter the auto industry.
(Lester Balaj)
(Lester Balaj)
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“Apple is moving forward with self-driving car technology and is targeting 2024 to produce a passenger vehicle that could include its own breakthrough battery technology,” Reuters writes.

Why It Matters: Apple changed the smartphone business, among others, and has a boatload of cash, so why doubt them? It took Elon Musk 17 years to get Tesla to sustain a profit in the electric car business. As Apple continues to work on its mysterious “Project Titan,” supply chain challenges persist, and it’s still “unclear who would assemble an Apple-branded car.”

Tell Me More About “Project Titan:”

  1. Apple decided to design a vehicle from scratch in 2014, though the process has gone “unevenly,” with goal shifts and layoffs along the way.
  2. Apple now intends on producing a vehicle for consumers, pitting the business directly against Google’s Waymo.
  3. According to people with knowledge of the Tech Giant’s plans, Apple has been tapping outside partners for help with the system, including Lidar sensors.

The gamechanger here is the battery. Apple reportedly came up with a new design that could significantly “reduce the cost of batteries and increase the vehicle’s range.”

  • Apple plans to use a “monocell” design that packs cells together and frees up space, and the company is experimenting with battery chemistry alternatives.

Some analysts think the best path for Apple to enter this space is through a partnership: “As we see with Tesla and the legacy auto companies, having a very complex manufacturing network around the globe doesn’t happen overnight,” said Trip Miller, a managing partner at Gullane Capital Partners.

The Takeaway: It could be a while before we sniff the Apple Car again. Reuters reported that two people with knowledge of Apple’s plans “warned pandemic-related delays could push the start of production into 2025 or beyond.” But it remains a question whether Apple would ever hit the production range of roughly more than 100,000 cars annually needed to turn a profit on the project.

Justin Oh:

This is the news we’ve been waiting for from Apple ($AAPL). I’ve needed to see some innovative fire in their bones as opposed to just making additional accessories for iterations of the iPhone. 

It is not in our DNA to invest in a stock on faith alone, so we will wait until we find out more about the Apple car and also assess the competitors that are coming to market soon before making a judgment. We still don’t find $AAPL stock particularly compelling compared to others available to us.

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