Are You More Surprised That Apple Is Making A Car, Or That They Didn't Just Buy Tesla?

Over the past year, I’ve argued that Apple should not have spent its considerable cash hoard on stock buybacks and dividends.  Instead, I’ve stated I thought Apple’s shareholders and customers would be better served by it spending its earned money on new products – either by acquisition or by internal investment.

Of all the possible investments or acquisitions they could make, I argued that the most attractive prize would be the electric car company Tesla.

Late Friday, a report emerged in the Wall Street Journal that Apple has over 1000 engineers currently working on a new project to build its own car.

MDarringer - 2/16/2015 10:39:15 AM

+3 Boost

Apple making a car is dumb. Apple buying Tesla would have been dumber still. Apple should collaborate with a big company to produce a game changing PHEV or EV that has a game changing user interface.

jeffgall - 2/16/2015 11:26:49 AM

0 Boost

A partnership will more likely not work for Apple. There would be too much collaboration and compromise involved. For Apple, it is there way or now way. This is why Apple has yet to produce their own TVs. They cannot own enough in terms of the cable provider. For this reason, Apple is best owning it completely on their own to produce the product they want.

Agent009 - 2/16/2015 11:54:21 AM

+1 Boost

They do like to control everything from top to bottom to ensure the experience.

MDarringer - 2/16/2015 2:26:50 PM

0 Boost

And that is precisely why it would work for a collaboration. Imagine a Cadillac. GM does the car and styling, but Apple designs the electronic architecture. Win/win. I'm assuming "there way or now way" means "their way or the highway" if we're attempting idiomatic expressions.

Apple could control everything about the driver interface experience and GM could control the mechanicals.

jeffgall - 2/16/2015 3:20:58 PM

0 Boost

It was supposed to read "there way or no way"

Apple would have no patience for the auto industry culture. Especially the antiquated way of doing business like GM. Apple would also have a huge issue with displaying their products in most auto dealerships today. Their merchandising requirements would make a GM dealership owner's head explode. Tesla probably has the closest sales model to what Apple would allow.