Apple Electric Car divides Wall Street over its potential
Apple (NASDAQ:AAPL) made headlines on Monday after Reuters said the tech giant’s planned self-driving electric iCar was a distinct possibility by 2024. It would develop proprietary battery technology to cut production costs while incorporating a multitude of technological innovations.
Or, as the news agency also said, the results could end up being part of an autonomous driving system housed in a traditional system. automaker car.
This same dichotomy was evident in the way Wall Street looked at development. It was either an existential threat to You’re here (NASDAQ: TSLA) or much ado about nothing.
Morgan Stanley Analyst Adam Jonas said his company’s teams have been waiting for Apple to make such an announcement for some time, as they believe Apple and other tech companies “potentially represent far more formidable competition” than OEMs. traditional cars.
Apple has hinted at the possibility of entering the automotive market for years, with CEO Tim Cook grateful in 2017 that the tech company was “focusing on autonomous systems” which are considered “core technology” in self-driving cars.
Conversely, City analyst Jim Suva was reportedly “very skeptical” of a car materializing, citing the cars’ lower profitability. He told investors in a research note that the most likely outcome was Apple pushing its operating system into consumer and enterprise markets.
Even so, Suva sees Tesla as the most direct competitor to an Apple EV, though it believes a partnership with component suppliers will be the result of its foray into the space, rather than an actual car. .
Certainly, lower profitability and a more cyclical auto industry would argue against an iCar, but Google has Waymo, and China Baidu is said to be plan a VE, too, so Apple might want to keep up.
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