Apple car might be a disaster

23 Sep 2015 | Author: | No comments yet »

Apple to release electric car by 2019.

Shortly after the launch of the new iPhone, Apple is aiming for something bigger. In typically secretive fashion, Apple appears to be moving forward with its long-rumored electric car project, now given a shipping date of 2019, The Wall Street Journal reported on Monday. First, Volkswagen admitted to systematically cheating on emissions tests, which is a polite way of saying it has been poisoning its customers for years. However, following the success of this project, the company may invest in a vehicle with self-driving capabilities howeverm, some reports say it is unlikely to be completely autonomous. The Journal reports that it will likely be partially-autonomous rather than the kind of fully self-driving car that rival Google is now testing on roads in Cupertino, Calif. and Austin, Tex.

Given the much talked about plans to break into the automobile market, Apple in the past year has hired many big names- Doug Betts, formerly of Toyota, Nissan and the Chrysler Group, joined in July; and Paul Furgale, a robotics specialist, left his former post at the Swiss Federal Institute of Technology earlier this year. As reports of mysterious shell companies, specialized workers poached from other firms, and sniping from traditional automakers abound, determining just what the the company intends to do with the project has quickly become its own cottage industry. From what it seems, Apple maybe considering Google as its competition given that it recently announced John Krafcik, a former CEO of Hyundai Motors America, as chief of its self-driving car project. Given Apple’s history of launching products aimed at more premium markets, typically at a higher initial retail price, analysts say it’s unlikely the company will break the mold by debuting an affordable electric car. “If you look at Apple’s history, every product they’ve done has tended to be very high margin,” says Sam Abuelsamid, an senior analyst at the market research firm Navigant Research who focuses on the auto industry. “They tend not to go into low margin segments, which the auto industry is very much in.” Despite rampant speculation about the 2019 shipping date, Mr. Abuelsamid says the rumored launch is “probably optimistic.” Apple faces a number of design issues, he says, including whether to manufacture the car bodies themselves or hand them over to a third party, as carmakers like BMW and Porsche are doing with some models.

Take the car out on the road, however, and it will pump out 40 times the allowed amount of nitrogen oxide, a pollutant that causes asthma, bronchitis, emphysema, and generally adds to that gray haze surrounding most American cities at rush hour. Some analysts say the market for electric cars, which has grown relatively slowly, represents a new opportunity for technology companies to expand their reach. “The shift to electric reduces the mechanical complexity of cars a great deal. No transmission or internal combustion engine means far fewer moving parts,” writes Benedict Evans, an analyst at Andreessen Horowitz, a Silicon Valley venture capital firm that invests in technology companies, in a blog post in August. In order to compete with dedicated carmakers like Tesla, which sells its cars directly to consumers through its own stores, Abuelsamid says Apple could consider introducing a leasing program modeled on its recently released iPhone upgrade program. Despite the ongoing rumors, news from the tech giant about its plans has been vague. “The car is the ultimate mobile device,” Apple Senior Vice President Jeff Williams said in May during a conference hosted by technology site Re/Code. “We’re exploring a lot of different markets.” In what’s become a frequent refrain for Apple – which has often promoted its products as “game-changing” – Mr.

Williams told conference attendees the company’s key priority in choosing what types of products to focus on next isn’t what will generate the largest amount of revenue. In May, the company began negotiating with officials at GoMentum Station, a former military base near San Francisco, about testing self-driving cars on the base’s nearly 20 miles of highways and paved streets, the Guardian reports. If we know anything about Apple, it’s that it wants to reach users on as many platforms as possible—personal computers, smartphones, tablets, TVs, and even the home itself.

Abuelsamid says other carmakers are trying to warn Apple about the difficulty of entering the car market, especially given the challenges of meeting stricter regulatory standards applied to cars compared with computers or mobile devices. Bob Lutz, the former chairman of General Motors, recently told CNBC that this venture will be a waste of time and money for Apple. “When it comes to actually making cars, there is no reason to assume that Apple, with no experience, will suddenly do a better job than General Motors, Ford, Volkswagen, Toyota, or Hyundai,” Lutz said. “So I think this is going to be a giant money pit.” Lutz is right that Apple faces huge hurdles here.

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