Between the aggregation, the speculation, and the punditry, those who haven't been glued to the tech press for days may be confused. Here's a brief guide to what is known about Apple and the auto industry, and why it has so many people talking.
1) Why is everyone talking about an Apple Car?
Apple CEO Tim Cook (Justin Sullivan/Getty)
Patient Zero for the Apple Car craze is a story released Friday evening by Daisuke Wakabayashi and Mike Ramsey of the Wall Street Journal. They reported that Apple "has several hundred employees working secretly toward creating an Apple-branded electric vehicle, according to people familiar with the matter." This was very quickly followed by a report from Tim Bradshaw and Andy Sharman of the Financial Times who say that Apple "is recruiting experts in automotive technology and vehicle design to work at a new top-secret research lab, said several people familiar with the company."
The FT also slightly contradicted the Journal's reporting, saying that "dozens" of Apple employees (rather than hundreds) "are researching automotive products at a confidential Silicon Valley location outside the company's Cupertino campus."
Reuters followed with a story from Edward Taylor and Alexei Oreskovic who reported that Apple is trying "to learn how to make a self-driving electric car" and sourced this information to "a senior auto industry source familiar with the discussions."
2) Is Apple building a car?
A Ford plant in Valencia, Spain (David Ramos/Getty)
Maybe! But even though it would be fun to assume the answer is yes and start the speculation rolling, the reporting that's happened thus far really leaves it very unclear.
For starters, hundreds of people isn't nearly enough to start a car company. Tesla, a high-profile but distinctly niche automaker, has 10,000 workers. The Volkswagen Group has over half a million. A group of hundreds could be the foundation of what ultimately becomes a stylish, technology intensive automobile manufacturing operation but it's a long ways from getting there. Maybe it's a serious exploration that won't go anywhere.
The subsequent reporting from the FT and Reuters may feel like it's confirming the WSJ report about an electric car, but in many ways it's not.
While hundreds is too few to run an auto production operation, it's certainly a lot of people. By contrast, the FT's team of "dozens" could easily be doing R&D on auto accessories rather than building a car. All the Reuters story really says, meanwhile, is that Apple executives talked to at least one senior auto company executive (probably from one of the German automakers, based on the Frankfurt/San Francisco byline) about self-driving cars.
That's intriguing, if true, but hardly definitive confirmation of anything.
3) Speculation is fun! What's the Apple car going to be like?
Ford 021C concept car, designed by Marc Newson now at Apple (Ford)
Here's how I'd be thinking about the landscape if I were the CEO of a cash-rich and highly profitable technology company with few products and some interest in the car industry. Right now, the automotive world is being unsettled by three trends that at the moment have not converged:
Electric cars
Autonomous vehicles
Smartphone hailing
But these trends actually should work together seamlessly in the long run. Rather than owning cars, people will get around town in electric powered autonomous vehicles that they hail from their smartphones. A company with a boatload of money, engineering, software, and design expertise could underwrite a shoot-the-moon project to create the future of daily transportation.
Electric cars: Current EV technology has a demonstrated capacity to deliver an excellent driving experience. But batteries capable of long-range driving (like the ones Tesla uses) are extremely expensive, and even with one long road trips remain annoying and inconvenient. But the vast majority of car trips are short — to work or the grocery store or the kids' school. If you hired a different car for each trip, EVs with relatively small batteries could suffice for the vast majority of travel.
Smartphone hailing: Mobile car hiring apps ("ridesharing") have been a big success at solving one big problem with the traditional taxi industry — it is a much more convenient way to connect drivers with riders. They've also improved payment systems. And by introducing additional competition into the often cartelized taxi industry, they've lowered prices. Buy paying someone else to drive you is still very expensive compared to driving yourself. Uber and Lyft have a great toehold in the modest-sized taxi market, but are still drops in the bucket of the overall driving around market.
Autonomous vehicles: A wide range of companies, including incumbent automakers and Google, have been developing various degrees of autonomous driving. This is technology with potentially far-reaching promise. But most car companies are focusing their efforts on incremental technologies like automatic parking, collision avoidance, and lane control that while intriguing aren't yet an obvious source of huge sales or profits.
Combine all three technologies in one package and you have a game-changer. The low fuel costs of an EV plus the zero driver costs of an autonomous vehicle, could make ubiquitous taxis the dominant form of urban transportation in America. Apple could do all that and make the car look really cool. Why not?
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