Is 2020 “the year of Electric Vehicles”? Tech. the news said yes. From Jan., Sony’s electric car surprised many in CES, Tesla became the most valuable automaker in Jun. to Dec., Reuters’s 2024 Apple Car report might add $102 B to Apple’s market value. Which is about one Volkswagen. This is crazy. So I can see the points why many worries about EV overhype, such as Toyota’s Chief. On the other hand, this is how venture capital normally chasing dreams. Anyway, some good changes may remind after the tide of the venture capital tsunami goes out. So why & how “Apple Car” may work differently?
Now or Never
BNFE forecasts 58% of new car sales will be EV by 2040, the trend is clear. And Apple has been doing something for the automotive vertical since 2014, e.g. Project Titan. So 2020 is just a year that news reports more. As a brand new digital experience transformation is accelerating, this frontier is indeed too important to miss for any big tech. The time can not be better because EV, 5G, etc. are growing. Those are great vehicles to carrier the transformation. It’s a great thing for consumers because Automotive has been “boring” for too long.
At a time like this, it’s easier for new players to challenge the established giants if playing the game very differently, which is how Tesla made it. Similar to what Apple & etc. drove the smartphone transition, which took 5 years to bypass feature phone sales. Some old kings, e.g. Nokia did not make it because they played the old game too well. Some were just too slow to adapt & being big may be a big disadvantage. Of cause, Automotive will not repeat the exact course. Nevertheless, a rhyme is very likely. Only it’ll take longer because of the long Automotive product development cycle, ~3 years vs < 1 year for mobile. However, changes may favor those, who stretch early for a small opportunity window. Any player who does not have skin in the game yet, already late for the first party. Also any player simply “chasing Tesla” is likely miserable.
Which Horse To Ride?
Even Apple does not want to miss the wave, Apple does not have to be a car OEM. It’s just more exciting to talk about Apple building a car for news. So even if you see an Apple Car on the road, it still far-fetches to be a commercial car OEM. The automotive industry has been building concept cars for many purposes other than production. Even it’s expensive, but still far “cheaper” than losing money in production, distribution, sales, etc. Also, Sony built a concept car to help to expand its camera sensor rather than car business. If Apple really wants to become a car OEM, Apple should have bought Tesla while it can. By now, it’s too late to be a “Tesla killer”. Instead, Apple should play its own games instead of Tesla’s. For examples:
- Apple has been doing CarPlay bringing seamless digital UX into vehicles by iPhone since 2014. Soon iPhone & Apple Watch can unlock new 2021 car models as car keys. Apple will double down on this. Hoping iPhone will be the “Smart Universal Controller” for cars & more.
- All passenger seat entertainment systems are very “Y2K”, Apple may simply define a plug & play standard for cars with iPad. The most difficult part is car OEM adoption rather than technical.
- As a top Apple analyst Ming-Chi Kuo suggested: “If Apple car wants to succeed in the future, the key success factor is big data/AI, not hardware”. Apple will try to catch up these gaps further, e.g. maps, music, podcast, Siri, iCloud… So even when you hear some secret car projects, you should connect the dots first. They may be research projects rather than intents for production.
More in 2021
It’s uncomfortable exciting to be another industry phase change. Automotive is likely going through a big one since 1908 — Ford Model T. For a “second chance”, I switched gears to work on a smart In-Vehicle Infotainment system platform in Feb. after 20 years as a “mobile person”. There is a lot to learn. So I will write to share more in 2021. Feel free to send me what you think & questions in concern.
Full Disclosure
The opinions stated here are my own, not those of my company. They are mostly extrapolations from public information. I don’t have insider knowledge of those companies, nor a whatever expert.
