Apple may only be able to use marginal car companies to achieve the dream of building cars.
The source of the header image is | Visual China
The author | Su Peng
Edit the | Li Huanhuan
Apple's car-making story has once again encountered twists and turns.
On January 23, according to Mark Gurman, a well-known bloomberg reporter, Joe Bass, head of software engineering project management for Apple's automotive team, has left Apple to join Meta (formerly Facebook) as director of VR technology project management.
With Bath leaving, the car management team Apple assembled a year ago has all but died, and the executives have left.
Since Apple officially announced the car, it has aroused the attention of the industry. Herbert Diess, CEO of Volkswagen Group, has posted that Apple poses a higher challenge to Volkswagen than traditional rival Toyota. Li Bin, the founder of Weilai, also said that only 5 car companies will eventually remain in the global high-end automobile field, including some new entrants, such as Apple.
Fearing apple's bloody storm in the mobile phone industry, traditional car giants and new car-making forces regard Apple as the most powerful competitor.
However, with the passage of time, Apple's mysterious car-making project has surfaced step by step, and people have found that Apple's outstanding global supply chain management capabilities, more than 100 automotive patented technologies and 1.3 trillion yuan of cash reserves have not shown their advantages in car-making.
Gurman believes that for Apple's car project, 2022 is a key year to determine success or failure. If Apple plans to launch fully autonomous vehicles in 2025, they need to act as quickly as possible — making fewer mistakes and fewer employee turnovers.
There is not much time left for Apple to trial and error.
1
No choice but to build a car?
In 2017, global smartphone retail sales reached a historical peak, the market was close to saturation, and then smartphone retail sales continued to decline. According to GfK data, 2020 is the fourth year that global smartphone retail sales have continued to decline, with global smartphone sales of 1.267 billion units, down 7.9% year-on-year.
Sales of Apple's core product, the iPhone, have also stalled in growth, with investors calling on Apple to launch a new blockbuster product as soon as possible.
In the face of the decline in the mobile phone market, Apple's old rivals have regarded the auto industry as a new growth point for the business. Samsung Electronics is currently considering an alliance with Hyundai Motor and intends to reach cooperation in the field of automotive chips; Huawei, which has sworn to say that it does not build cars, has long extended its tentacles into the automotive industry, and Xilix SF5 and Q&I M5 have explored the way, and Huawei may only be one foot away from personally building cars.
Source: Visual China
Analysts pointed out that the automotive market has great potential, and people will spend a long time in the car every day in the future, and Apple cannot be absent.
Morgan Stanley analyst Katie Huberty has released a report that smartphones have a total effective market (TAM) of $500 billion per year, in which Apple has about a third of the share. While the global auto and mobile markets are valued at about $10 trillion, "Apple only needs to account for 2% of the market, which is equivalent to the size of its iPhone business."
Baird analyst William Power also said in the report that the auto market is a multi-trillion dollar market with "huge long-term growth opportunities." If Apple enters the automotive industry, it could see about $40 billion in growth.
In fact, as early as 2014, Apple launched the Titan plan and officially entered the automotive industry. Initially, Apple gathered more than a thousand employees to work on an internal electric car code-named "Titan Titan" at a secret location near its headquarters Cupertino.
Although research and development has been launched, Apple's start-up team still has not agreed on the development priorities, whether to directly build electric vehicles or self-driving technology, has become the focus of debate between the two factions. After several rounds of games, after experiencing twists and turns such as layoffs, reshuffles, and suspension of car-making plans, at the end of 2020, Apple finally chose to restart the car-making plan.
According to Reuters, Apple has handed over its autonomous driving division to the leadership of AI senior director John Giannandrea to continue to develop autonomous driving technology, with the goal of launching the "Apple Car" in 2024, and the car is expected to use Apple's self-developed breakthrough battery technology.
At this point, it has been 6 years since Apple launched the Titan program. In the past 6 years, "Wei Xiaoli" has launched a number of new cars and is approaching the annual sales mark of 100,000 vehicles, and Tesla has reached millions of annual sales.
For Apple, it is too late to enter the game.
EVTank predicts in the "Medium- and Long-term Development Outlook of the Global New Energy Vehicle Market (2030)" that global new energy vehicle sales will reach 18 million units by 2025. Looking forward to 2030, EVTank expects global new energy vehicle sales to reach 40 million units, the penetration rate will reach about 50%, and more than 90% of new energy vehicles will be pure electric vehicles.
UBS analyst Patrick Hummel expects Tesla and Volkswagen to become the most profitable companies in the electric car space in the coming years. In 2025, Tesla's sales volume will reach 2.3 million vehicles, and the operating profit will reach 20 billion US dollars.
Technology giants such as Baidu and Xiaomi are also working hard, Baidu and Geely jointly created the first model of Jidu is expected to be delivered in 2023, and Xiaomi will also lock the mass production time of the first model in the first half of 2024.
Apple is bound to speed up the process of building cars.
2
Apple has no "friends"
Apple's strength lies in the software technology reserves.
According to the incomplete statistics of Future Auto Daily, from 2015 to 2021, Apple has obtained nearly 200 patented technologies related to cars, including key technologies such as automatic driving, battery technology, and wireless charging. At the same time, Apple has also developed forward-looking technologies such as silent electric doors, automotive interiors without steering wheels or throttles, AR displays, next-generation lidar sensors, and spherical tires.
In addition, Apple also secretly designed the shape of the first model.
Apple car design drawing Source: Apple official
In addition to these software technologies, Apple has nothing else to do when it comes to building cars.
"The advantage of Apple's car manufacturing lies in the software level and the production and manufacturing capacity of hardware, which Apple lacks." An industry insider commented that Apple's car "has a brain and no shell."
The above analysts believe that it is unlikely that Apple will build its own factory. On the one hand, the cost of self-built factories is high, and the time is too long, which is not conducive to Apple catching the "last train of car building"; on the other hand, self-built factories require Apple to have the ability to grasp the quality control of automotive products and supply chains, which is exactly what the technology company Apple is not good at.
In order to quickly assemble its own car shell, Apple had to seek cooperation with the vehicle company.
In January 2021, South Korean media IT News reported that Apple contacted Hyundai Group to produce self-driving electric vehicles in Georgia, planning to reach an annual output of 100,000 vehicles in 2024 and a planned final annual production capacity of 400,000 vehicles.
Hyundai Motor feared becoming a foundry for Apple Cars, thereby damaging its own brand value, and the cooperation plan between the two sides was once stranded. Reuters quoted Hyundai executives as saying Hyundai was upset about how to move forward with the deal. Soon after, Hyundai Group announced that it would stop working with Apple.
In October 2021, Apple once again negotiated with BYD and CATL on the supply of power batteries. Because the latter two did not agree to build a battery factory in the United States and formed a cooperative development team for Apple, they eventually rejected cooperation with Apple.
An insider close to BYD told Future Auto Daily that being able to enter the Apple industry chain with a market value of more than 3 trillion yuan can bring huge revenue to BYD. "But the need to build a factory in the United States, BYD is difficult to accept." On the one hand, IT needs a large amount of space costs and taxes to build factories in the United States; on the other hand, Sino-US relations are becoming increasingly tense, and BYD is not willing to muddy the waters. ”
A new apple report shows that in 2020, Apple also contacted a component manufacturer about a potential supply deal. Due to a number of problems, the negotiations eventually came to an abrupt end.
According to the Nikkei News, Apple has negotiated with at least 6 car manufacturers in order to build a car, but these car companies without exception cannot accept the cooperation model with Apple. "The judgment that car companies will evaluate whether to accept the 'horizontal division of labor' model of sharing design, development and production with Apple is undoubtedly difficult." Sources quoted by the Nikkei shimbun said.
"Based on the prediction of Apple's competitiveness in the market, it is difficult for car companies to accept OEM for Apple, which is undoubtedly a tiger breeding problem." Chen Guangzu, an expert in the automotive industry, analyzed the future automotive daily.
Chen Guangzu believes that Apple is also reluctant to share its software technology with car companies, that is to say, "cooperation with Apple can only charge foundry fees, which is not a good deal for the car companies that Apple is currently approaching."
Perhaps, Apple can only use marginal car companies to achieve its own car-making dream, just like Huawei joined hands with Xiaokang and Weilai to choose JAC.
Given the current deadlock in negotiations with partners, Apple analyst Ming-Chi Kuo believes that Apple cars may not be launched until 2028 or later.