This week Apple killed their Titan electric car project. It was effort that began ten years ago and became the biggest development project in the history of the company, measured both by the investment and size of the organization: billions of dollars spent and two thousand employees hired.
When they began, the EV market was very different than it is today. Tesla was struggling, four years away from shipping its first product. The opportunity was there for Apple, especially as the EV evolved as a computer on wheels, where software was integrated into a battery-powered electro-mechanical platform. Apple had many of the skills that might have created something special: hardware engineering, software engineering, industrial design, and the best understanding of human usability in complex consumer products. They were particularly optimistic about going right to a new self driving vehicle, with Tesla convincing the industry it was just a couple of years away.
But Apple did not have several important skillsets to be successful with an EV. It was not good at rapid product design and never felt a sense of urgency. After all, it was flush with money from their iPhone sales. It didn’t have a visionary leader driving the development, just a lot of managers, some without a strong product sense, coming and going.
And it never had a clear definition of what it wanted to create. First, they envisioned a self driving vehicle with no steering wheel and propelled by Siri commands, then a robotic car, to finally just a plain EV with no self-driving capabilities at all. Apple also suffered from the NIH complex, not invented here. They could have even bought Tesla early on, but decided they’d rather go it alone.
While these traits can be forgiven when developing an evolutionary product or one with little competition, it was fatal to their car project. They watched while thirty other car companies developed EVs during this time, and, if the reporting is to believed, they still had no vision of what they wanted to do in the end.
While industry analysts, for the most part, are happy with Apple’s decision, I see it differently. Building a car was one of the few areas where Apple had an opportunity to continue on the same rapid growth trajectory. There are few consumer product segments that could contribute to the income as much as an automobile. While the margins would be lower, an Apple car would have commanded a premium. Ironically, Apple suffered from a lack of imagination.
And, think of all those added costly accessories Apple is so good at creating: braided charging cables, dongles for their proprietary charging port, a silicone car cover and Apple CarCare. Just kidding.
Much the way that Apple partnered with Foxcomm to build their iPhones and other devices, they could have done the same with Chinese manufacturer BYD that is building a wide range of EVs from under $15K to over $200K. They could have focused on the software, the user experience, and the user facing hardware, and had the best of both worlds.
Apple is left now to play a small roll in the auto market, continuing to provide Apple Car Play to automotive manufacturers. Its leaders can take no pleasure in having spent so much money and having so little to show for it. It really is a major stumble and an embarrassment.
Apple has said that it’s moving many of people that had been working on the car to a new group devloping AI. This is an area where Apple lags years behind companies such as Goggle, Samsung and Microsoft. Let’s hope they’ll be a lot more agressive here.
