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Entry 2020.12.23 14:22
“Apple has already prepared the EV business as a new growth engine for a long time.”
Using mobile devices and IoT to achieve a breakthrough in the field of mobility
Negatives “going into the old business, the profits are too small compared to the huge investments”
Amid reports that Apple’s long-awaited entry into the auto business is becoming visible, Wall Street, analysts and investors are giving highly conflicting views.
While some people claim that Apple, which has strengths in the fields of mobile devices and software, can exert great influence as the mobility industry is rapidly converting to autonomous driving and electric vehicles, there is also the possibility it becomes a “ handshake. ”
Since the mid-2010s, Apple has been secretly working on a driverless car project under the name ‘Project Titan’. Most of the plans are veiled, but part of the reality was revealed when documents about Project Titan were leaked through some media in 2015. It is known that Apple has a roadmap to launch electric vehicles first and then develop them into vehicles. self-employed in the medium and long term. Apple has been researching electric vehicles creating Project Titan since 2014, and in 2018 it also recruited Doug Field, who was in charge of development at Tesla.
First, on Wall Street, there has been a controversy over the recent report on Apple’s entry into the auto industry. As for the prospect of Apple entering the auto industry, the so-called ‘positives’ understand that Apple’s growth is stagnating, as a natural proceeding. In fact, sales of $ 233.8 billion in 2015 only increased to $ 274.5 billion last year. WSJ noted that “the biggest innovation Apple has made in the last 10 years since the iPhone came out is the single field of headphones.”
His view is that the combination of smartphones and electric vehicles has the potential to make huge gains in the changing mobility market. The automobile market is a huge market worth 2 trillion dollars. Furthermore, if various services, such as music content, followed by electric vehicles and smartphones, are delivered through Internet of Things (IoT) technology, the current stagnation in the growth potential of the automotive industry will find great advance immediately. It is analysis.
In addition, the production capacity of existing automakers is overflowing enough to reach a glut. It can easily be done by purchasing a factory cheaply and changing it, or by partnering with a company that is struggling to develop electric vehicles. Although it is difficult to enter the market for electric cars, Tesla has done it too, and there are also places like Nikola, a startup. Chinese internet companies are also considering outsourcing electric vehicles in this way.
On the other hand, there are some negatives that Apple’s entry into the electric vehicle business will be the worst mistake. WSJ is a low-margin, capital-intensive industry. The gross margin of the world’s top 10 automakers is 15%, much lower than Apple’s 38%. This is not a market that high-margin companies like Apple can enter. In particular, the capital inflow is huge, but the return that can be achieved compared to today’s auto industry is not at the level Apple is seeking.
Jim Serva, an analyst at Citigroup, said: “Apple is doing research and development (R&D) in many fields, so it is not surprising that the ‘Titan’ automotive project is also very low.” I am very skeptical about the automobile manufacturing “.
Some believe that even if they enter the automotive industry, they will only observe the situation in the field of autonomous driving software. Jean Munster of Loop Ventures said: “Apple doesn’t seem to have a clear choice between making Apple-branded cars using autonomous driving technology that has been developed over a long period of time, or whether automakers are going to make sales by providing software. “.
