All You Need to Know About Apple’s New Electric Car

Apple electric car

Electric vehicles (EVs) are on their way to become the Model Ts of the 2020s.

Much like their centennial counterparts, they are the raging tech-aspired phenomena of this decade with similar likeness in expected features: cheap, compact and revolutionary of the contemporary automobile industry.

Note that the operative word is ‘expected’. It is the desire for improved efficiency, eco-friendliness and affordability that has attracted the attention of tech heavyweights into investing greatly upon their success, the latest among such top cats being Apple Inc.

Yesterday, Apple and Hyundai Motors were reported to have agreed on their plans to collaborate on the manufacturing and development of autonomous cars by as early as March 2021. While the news wasn’t surprising to have followed on the heels of the Reuters report last month on Apple’s ambitious plans to embark into autonomous car and battery technology by 2024, it certainly sent market sentiments flying high (shares of Hyundai and Kia rose as high as 14.6% and 9.1% respectively).

Let’s see the possibilities presented by Apple’s plans to launch a self-driving vehiclethat will allow the user to input their destination and be driven there with “little or no engagement”!

Giving Tesla A Run For its Money?

A market leader in consumer electronics till now, Apple’s interest in the EV market is apparent from the sheer size of the $2.55trn-large Total Addressable Market (TAM), almost six times higher than the global smartphone market ($420bn). Apart from that, a desire to create its own intellectual property in the vehicular market, build premium product lines and the opportunity to monetise its allied services from autonomous vehicles are abundant reasons to have propelled this charge.

Apple has been keeping its escapades into the vehicular industry pretty close to its chest for a while now. In 2014, it launched Project Titan to explore an entry into the EV market. The project was so secretive, that four years later, 190 members working on it were jointly laid off in 2019 due to reasons unknown.

The project was pegged to die shortly thereafter. Only, it was rejuvenated with the entry of former Apple executive Doug Field and newly-hired Steve MacManus, Michael Schwekutsch and Stuart Bowers (all jumping ship from Tesla) to oversee Titan.

If that wasn’t enough to hint at Apple’s categorical rivalry with Tesla, then Elon Musk’s remark on being turned down for acquisition by Apple CEO Tim Cook, struck quite an evidence!

EV market

Fun Fact: A novel self-driven employee shuttle program called PAIL (Palo Alto to Infinite Loop) is also being designed by Apple to ferry its employees around the Silicon Valley. Volkswagen’s T6 Transporter vans are being used to install the self-driving softwares for now.

How Do You Like Them EV Apples?

Following are some of the cutting-edge technological employments that have set the industry expectations rolling from Apple EVs:

  • Radical advance in “monocell” battery design (more space in smaller packaging).
  • Expectedly reduced costs and higher range.
  • LiDAR (Light Detection and Ranging) sensors, akin to those in a few models of the iPhone and iPad are likely to lay the defining capabilities of self-driving systems (complete with 3D navigational views).
  • Possibly experimental adoption of Lithium Iron Phosphate (LFP) power cells in batteries to reduce overheating.

According to data from the California Department of Motor Vehicles, in 2017, Apple’s autonomous test vehicles drove an average of 118 miles before a human safety driver could take control. This was a significant improvement from the 1 mile per disengagement test recorded a year before, showing promising results for a self-driven car system.

The Hyundai Deal

The reports circling the proposed collaboration are still speculative. Officials from both the companies have indicated corporate inclinations towards partnerships with other players in the same sector as well.

For now, the initial Korean IT News report has emphasised on the release of a “beta version” of an EV by 2022. Production is expected to begin in Kia Corporation’s (34% Hyundai-owned) plants in Georgia, USA.

Challenges Ahead

Apple’s business model is based on innovation and consumer-centric devices. It has been successful so far owing to their reserved bases due to the hallmark easy-to-use designs and convenient data migration plus synchronisation across renewed product lines.

That’s well and good for smart devices and in-built IoT-adapted systems. But how do you reconcile this data integration in unformularised (and combustible) devices like EVs?

It may have been seemingly conceivable once upon a time but ain’t no catalytic innovations of Steve Jobs around to fall back on now, are there? (RIP!)

Second, automobiles is a fairly capital-intensive industry where unfortunately, Apple has no experience. Here’s where the natural adaptation of partnering with Hyundai (or possibly others?) makes sense. But even then, getting a vehicle into production and assembly lines by 2024 with all kitschy Apple features and bugs fixed, carries a non-zero risk profile.

Third, there is considerable investor-significance for Apple involved in this foray into an off-hand sector. Although the company has historically maintained higher profit margins, the EV market is huge with new players and emerging technologies coming into the fore every day. Gross margins are estimated to be much lower than Apple’s other products, especially if the company follows the outsourced manufacturing business model over vertical integration. A massive growth runway, albeit infiltrated with layers of execution risk and lower consolidated margin outlook, is perhaps going to be the theme around which the stock trades over the medium term as Apple’s EV bet continues to gather steam!

The Race is On!

This sort of inroad by a tech behemoth into the EV industry isn’t unprecedented. Baidu, the popular Chinese search engine, also unveiled its plans recently to manufacture original equipment for EVs with Geely, another Chinese automaker. Not just Big Tech, but the startup-interest in the EV segment lately is nothing short of immense.

However, few of them have the same commitment to innovation, promising sales and distribution, marketing strategy or immaculate supply-chain management as Apple, which is crucial to make a mark in a sector that is becoming increasingly symbolic of a green and fossil fuel-minus world economy. So, drive safely, iCars!

(Originally published January 13th 2021 in



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