Apple Set To Shelve Its Long-awaited Electric Car?

With the rising popularity of electric vehicles (EV), it’s no surprise that the number of companies engaged in this market are increasing. So much so, that even companies from unrelated industries are entering the arena, while EV leaders are investing more to expand their capabilities and cater to more customers.

At the same time, the battle at the top is heating up, with industry leader Tesla losing out top spot to Chinese automaker BYD. Of course, Tesla isn’t going to go quietly into the night, as it has its targets set to lead the race in the long term.

However, there are a few companies that have voiced concerns about the market as a whole.

One of these companies includes Apple, which finds itself in the news for the wrong reasons as far as its long-term project to produce the much-awaited electric Apple Car.

So, what’s being said about Apple’s car? Let’s explore!
 

What Was Reported About Apple’s Electric Car?

 

• Apple is set to shelve its plan to build an electric car for good, as per a report by Bloomberg citing people familiar with the matter, who didn’t want to be identified as the announcement wasn’t made public yet.

• Apple disclosed the information internally to over 2,000 employees working on the project, which came from Jeff Williams (COO) and Kevin Lynch (VP of Technology).

• A project that was in the making for over a decade and titled Special Projects Group or SPG, will see its team members shifted to Apple’s artificial intelligence (AI) division and focus on the company’s GenAI (generative artificial intelligence) projects, which is a key area of expansion.

• The team also consists of a few hundred hardware engineers who might apply to join other Apple teams. However, it’s believed that there will be layoffs although the number remains unconfirmed.

• Reportedly, the decision was finalized in recent weeks, with the previous discussion being about delaying its release until 2028 and reducing the self-driving capability from Level 4 to Level 2+.

• The company had even roped in experts from across the industry, including designers from companies like Lamborghini, Aston Martin, Porsche and BMW.

• While Apple declined to comment or confirm how much it spent trying to make this dream come true, it’s believed that the project that initiated in 2014 had a multi-billion-dollar effect on the company along with news of it shutting down coming as a shock to employees.

 

What Were The Challenges Faced By Apple?

 

• Apple’s project, which began in 2014, has undergone numerous changes, starting with an idea of producing a car without a steering wheel or pedals, which was quickly scrapped.

• The endgame was to have a self-driving EV that possessed “limousine-like interior and voice-guided navigation”. However, developing the self-driving system itself was tough, even though the company had trialed its system using a Lexus SUV, as well as other components on a track in Phoenix.

• The project even witnessed several leadership changes.

• While being years away from production and running through different designs, Apple ended up facing a cooling EV market, owing to high prices and charging infrastructure challenges.

• One of the bigger roadblocks on Apple’s road to success was pricing, with the company looking at selling its car at around $100,000, which itself posed challenges to adequate profit margins considering Apple’s typical track record.

• Essentially, the company’s board weren’t convinced about the hundreds of millions of dollars being spent to achieve an unassailable dream.

 

How Did Others React?

 

• While Apple declined to comment, experts from within and outside the industry shared their thoughts.

• Bloomberg’s Intelligence analysts Anurag Rana and Andrew Girard believe that it would be a better move for Apple to focus on AI instead, writing in a note, “Apple’s decision to abandon electric cars and shift resources toward generative AI is a good strategic move, we believe, given the long-term profitability potential of AI revenue streams versus cars.”

• It’s believed the move came as a relief to investors, with Apple’s stock closing around 1% higher.

• On the other hand, industry leader and Tesla CEO, Elon Musk shared a post on X mentioning the news with a saluting and cigarette emoji.

While Apple has scrapped projects before, including one to make a TV, only few projects have consumed such large durations, resources, costs and employees.

Do you think Apple would be correct to give up the EV dream? Do you think Apple could take on Tesla and BYD if it were to release an electric car?

Let us know in the comments below!