Does Apple really want to make a car? Or does it want to become more like a 21st-century ACDelco, making electronic controls and accouterments for cars manufactured by someone else? (If you ever drove a 1990s Chevy Cavalier with an ACDelco radio. You’ll know that bar is not very high.) It’s hard to know, of course. This is still the company built by the famously secretive Steve Jobs, who for years ran a three-day strategy meeting that wasn’t even called a meeting (staffers were barred from saying the meeting’s name out loud: “Top 100”).
Thousands of stories and blog posts appeared this week, trying to read Apple’s tea leaves. There seemed to be plenty of arguments for both strategies. A car is not one manufactured thing, but rather an amalgamation of hundreds of them all working together (or, in the case of the Pontiac Grand Am, trying to rip each other apart). Apple is expert at creating attractive, intuitive software and hardware. But does that mean the company really wants to get into the business of designing inherently unsexy, low-profit things like continually variable transmissions? Maybe not.
“(R)eplicating all the manufacturing carmakers already do isn’t where the real opportunity lies,” opines Will Knight of MIT Technology Review. “A smarter strategy, surely, would be to invest in developing new software, and maybe some new hardware, that transforms the driving experience, and then sell that technology to as many car manufacturers as possible.”
On the other hand, Apple does seem pretty serious about this whole car-business thing. It’s gotten itself sued by battery-maker A123 Systems for allegedly poaching top talent, an allegation seconded by Tesla founder Elon Musk. Jony Ive and Eddy Cue, who lead Apple’s design and software efforts (and whose names alone would make them awesome additions to the cast of a Goonies remake) both are bona fide car geeks.
Also, Apple is sitting on an enormous pile of cash—at least $178 billon—and it can’t spend the money in the U.S. without paying massive dividends to stockholders and taxes to the U.S. government, as The Guardian reported. Developing an Apple Car, (maybe with a Chinese manufacturer?), certainly would be one way to burn lots of offshore cash.
Nor would this be the first time Apple has ventured far from its personal computing roots. The company is building two enormous data centers, one in Ireland and another in Denmark, both of them powered entirely by renewable energy. It’s also participating in a humongous solar farm in California.
So whether the company plans to build an entirely new car from the ground up, or merely a car with Apple-borne design and interactive systems, its foray into the automotive sector certainly appears serious.