Weekly Brief: Apple Eyes Up Era of the ‘iCar’
Only Apple could trump the Super Bowl.
During a week when all eyes usually converge on America’s largest sporting event and the TV ads that make it famous, last week attention was diverted to tiny West Point, Georgia, where rumors are swirling that Kia’s manufacturing plant could soon be home to the all-new, fully autonomous, all-electric Apple Car.
According to anonymous sources at CNBC, Apple is close to inking a manufacturing partnership with Kia’s parent company Hyundai. Bloomberg tapped into the Korean news network to provide further details: Apple will invest $3.6Bn into a joint venture with Kia with an expected manufacturing start date of 2024. The governor of Georgia, Brian Kemp, said he welcomed the news and hailed “Georgia’s status as a leader in technology, innovation and manufacturing”.
Could all of this be baseless speculation? Of course! Apple Car rumors are a bit like Yeti sightings – always cropping up, never confirmed. On the other hand, Hyundai admitted that it was in the early stages of discussing a potential partnership with Apple last month. The carmaker has made it no secret that it plans to ramp up its EV strategy in 2021. We also know that Apple has been investing heavily in self-driving cars since it launched Project Titan in 2014 and the timing seems right for it to finally come out of the shadows, given Apple’s corporate history.
The tech giant isn’t a company that assumes unnecessary risk in search of first-to-market advantage. Its MO is to enter a field once it has been loosely established and then blow away the competition with superior design and consumer friendliness. The smartphone is a useful corollary here. IBM debuted the first smartphone in 1992. Blackberry jumped on the bandwagon in 1999 but everyone really thinks of the smartphone era as starting in 2007, when Apple launched the iPhone.
The trajectory of self-driving cars is similar. The US Department of Defense hosted a DARPA Grand Challenge in 2004, which asked researchers to create vehicles that could drive themselves along a 150-mile roadway that snaked through the California-Nevada desert. The Grand Challenge jump-started the self-driving car race. Google created Waymo as the Self-Driving Car Project in 2009. Tesla debuted Autopilot in 2015. Waymo launched America’s first self-driving taxi service in 2018. GM Cruise started testing its self-driving cars in San Francisco last year without driver’s behind the wheel.
Despite all this activity, Apple would love for the history of self-driving cars to be remembered with a start date of 2025, when it launches the Apple Car. One anonymous source in the CNBC story suggested that the Apple Car will be used for food delivery and robo-taxi services. That could be, although it would be a strange fit for a company that has always focused on consumer-facing products, be they desktop computers, laptops, music players, smartphones or watches. My suspicion is that Kia will build Apple an EV that competes with Tesla for the consumer segment. This seems likely given how little Apple has tested self-driving technology on public or private roads. It would take years to build up creditability and challenge the likes of Waymo with a fully autonomous system. An easier path is to provide an advanced driver assistance system, like Autopilot, that will transition to full autonomy over time.
All of this remains to be seen. What we do know for sure is that the Tampa Bay Buccaneers routed the Kansas City Chiefs in the Super Bowl, and General Motors stole the show with a hilarious advert about America overtaking Norway as the country that produces the most EVs per capita in the world.
