What Shall Apple Do with All That Money? Rethink the Car

| Particle Debris

When a modern company has some extra money, creative executives have refined the art of rolling that money upwards towards themselves often starving other efforts. Even so, while car company R&D budgets are generally healthy, they may not be enough to make a major breakthrough in 21st century car technology. What if that's what Apple is planning to do?

There was a time, years ago when analysts asked Steve Jobs what Apple would do with all its money. That was back when Apple only had about $76 billion in holdings. Steve Jobs said:

We'd like to continue to keep our powder dry, because we do feel that there are one or more strategic opportunities in the future. That's the biggest reason.

Typically analysts and observers have thought in terms of a giant acquisition. That's how traditional companies have thought in the past. Buy up the competition, acquire patents and talent, lay off the low-productivity workers and gobble up market share.

Regrettably, the combination of low margin businesses and the desire of every executive to demonstrate success by virtue of their wealth has left few companies in a position to spend a groundbreaking amount of money on completely shattering their competitive marketplace.

However, that's exactly what Apple may be preparing to do with its "Titan" car project.

Now is the moment in time when Apple can make a major contribution to the electric car. Heretofore, electric cars have either been a hedge against the future or a move to meet U.S. Government total emission regulations by partitioning their product line into some percentage of electric cars. And while Apple may not be able to achieve a fundamental breakthrough in battery technology, the intelligent combination of all technologies could create a car whose whole is more than the sum of its parts.

That's not to say that some companies aren't all in with a great vision. Tesla sees things differently and is making great cars, but they haven't made a lot of money doing it.

And so the Apple strategy has to be:

  1. A grand vision of what a 21st century car should be like.
  2. Seriously large amount of R&D to make major breakthroughs.
  3. A keen connection to the modern technical buyer's mentality in terms of the purchase experience and automotive experience.
  4. A plan to actually make money rather than lose money with the final product.

Over at Mac360, Will Gomez wrote, insightfully: "What to Expect From Apple Car." Here's a notable excerpt.

Historically, Apple tends to look at product markets through different lenses than those already churning out traditional products in the same industry. The Mac? Much different than DOS PCs or even the Apple II before it. iPod? Different. iPhone and iPad? Different. Watch? Different. All those products set the design standard and moved their respective industry segments forward and the rest of the competition followed.

As for making money, the analysis at Asymco says:

To break into the top 10 brands would imply a production volume of at least 2.5 million units (about the same as Daimler ships today.) At 2.65 million and a price of $55k/vehicle Apple’s revenues from cars would total about $145 billion. This is roughly the sales value of the iPhone business today. Not bad. Maybe that would satisfy a financial analyst.

And so. All the pieces are in place. Apple has the cash to make a breakthrough. They have the experience to disrupt the industry. And Apple knows how to make money in the process.

That Steve Jobs powder is set to explode.

Next page: the tech news debris for the week of September 21. Our Star Trek future.

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Lee Dronick

Tesla sees things differently and is making great cars, but they haven’t made a lot of money doing it.

I think that the price of their electric vehicles is “currently” too high to entice the majority of car buyers. I would say that the sweet spot is about $30,000, maybe that is more me than you. There are also other factors such as charging stations, but more and more places are adding them. Anyway it will probably be quite a while before internal combustion engines are replaced by electric, those running petroleum and not say methane or something more quickly renewed.


a price of $55k/vehicle

Tesla starts at $69k, not that much more.
This year the average selling price a new car in the US was $33k.
The most expensive car I’ve ever bought was $26k.
If they want to revolutionize the market Apple will have to come in at or below $30k-$35k or it’ll just be another luxury car for the rich.
Not very revolutionary.

Lee Dronick

If they want to revolutionize the market Apple will have to come in at or below $30k-$35k or it’ll just be another luxury car for the rich.

They could also have an Edition edition as well as a Sport model, and one in between.


First of all - if we all agree that a new car should be electric or at least non-ICE, then get rid of that dumb-ass illustration which shows obvious non-aero gaping holes that only an ICE engine would need; same with the gash on the side - useless.
Margins: Apple likes margins
Debt: Apple doesn’t like debt
Market: ripe for change, but towards autonomy not just another electric car.
Disruption- BMW i3, i8, Tesla Model III, and of course Maximum Plaid in next Roadster, GM Bolt, ... what can Apple add? Literally, tell me. If it’s “merely” voice control or interface then I stick to a “system” as an Apple possible product - not a car.
Of course, if I can send you a 3D printer file of the body panels I want you to install on my new AppleCore GT all electric chassis and the whole thing goes for $20k now THAT would be disruption. Toys for rich people only don’t do any good for humanity, ask Henry Ford.


Apple likes Margins
Apple likes profit, not debt
Apple likes markets that are new
Apple likes the word “disrupt” (i3, i8, model S, model III, Volt,Bolt)
Making toys for rich people only has never done anything positive for humanity - just ask Henry Ford. (hence Tesla Model III coming soon)
The above is why Apple is NOT making a car. What can they add? Literally tell me? If it’s anyway software like voice control then no, they wouldn’t need to build the whole widget.
Now, if somehow they came up with a gimmick like custom order 3D printed body panels (provided by customer or chosen from catalog) on a modular AppleCore GT chassis with all electric 300 mile range for $20k - now THAT’S disruptive; anything else is well - good luck.


I’m not a lover of electric cars. They’re clunky, range-limited and not as environmentally friendly as everyone seems to believe, since the electricity in a battery come from largely burning fossil fuels, and some nuclear power.

But if we’re talking about the future, increasingly efficient fuel cells, or hydrogen fueled turbines start to make sense, especially to the environment.


9 out of 10 people don’t travel 40 miles a day - so range is a fallacy, and with the solar powered Supercharger network there is no dirty electricity and no fossil raping of the land as there would be with Hydrogen, Fuel Cell or any Hybrid system. The Giga factory and Tesla’s factory are “clean” and have a zero carbon footprint. Battery waste can be recycled and what waste there is is nothing compared to nuclear waste or the climate change associated with burning shit and releasing waste shit.. Clunky? How wrong can you be? You ever drive in a Tesla? It’s only the fastest quietest car on earth and if almost 300 mi. range with 30 min. 75% recharges for free ain’t enough then I want what you are smoking. Fastest - and quietest - makes ICE cars look just stupid and old. If it (the motor) explodes, you’ve already lost the future.

Lee Dronick

Cuda your almost certainly correct about the average daily drive.


Year 2020: Lee Dronick via iPhone orders his car for the day only today it’s a “waiver car” only allowed on “dumb” roads and will suck both your Visa card AND “obsolete” petroleum byproduct but that “waiver” allows you to actually control a car - in this case you chose a ‘58 Merc Highway Cruiser for a 1000 mile month jaunt just because…you Remember, and you CAN.
Then Monday, back to the cars you programmed to do what you do- they come they go - you don’t care where it goes at night as long as it picks you up the next day as ordered….


Yeah, sorry for the semi redundancy but i sent a blast in and it didn’t post so I re-phrased and re-posted and now there are both messages. I’m sure my fans care because I’m so loved here…. but I thought someone else was having the same syndrome so fyi…..

Lee Dronick

In 2020 I will be 70 years old and probably driving a simulator Model A pickup via an Apple TV app.


Yeah, at 4k maybe. lol.


You know i meant Turnpike Cruiser anyway for that ‘58 Merc, at 70 I just hope we still remember all the silly fun,  but still rage…...



There are plenty of articles and arguments around Apple’s foray into the automotive industry, and their capacity to 1) make a car, 2) disrupt the industry, 3) make a profit, 4) make a difference, 5) not implode under their own gravity into a blackhole of misdirected, misspent and misguided adventurism.

Will Gomez does an excellent job of conducting an anatomical destruction of many of these objections. Yet, these knee-jerk objections of ‘Apple has no experience in…’ and ‘No one can make any money on…’ or even ‘There are already many companies making…with years more experienced than Apple, so why…’ and perhaps best of all ‘This industry is nothing like anything Apple have ever done before…it’s not something simple like making a PC/music player/online store/retail store/smartphone/tablet/watch/whatever’ will likely continue. It would be a telling exercise were a plucky scholar to research and compile all of the objections over the years, together with a representative sample of published opinions of the leading pundits of the day, and what became of that ‘foolishness’ pursued by a ‘hungry’ Apple. Perhaps Dilger will once more apply his wit and skill to such a task.

In any case, so well-trod is this theme that it merits no further discussion. Rather, the lesson for any thoughtful observer, including businesses and acadaemia, is how Apple are re-writing the textbooks on how to grow a business, specifically a tech concern; more specifically still, how to systematically leverage one skill set into the development of a new competency, which in turn becomes the skill set for venturing into another industry. Underlying this novel process, which few companies have the resources to match and fewer still the demonstrated strategic thinking to exploit, is something plainly obvious, namely the growing inter-relatedness of formerly disparate disciplines and industries -  a phenomenon facilitated both by new technologies that bring these industries into proximity with one another and by the deliberate actions to link and harmonise them by perspicacious if not audacious companies, like Apple. A computer cum electronics company moving into watches and cars and what-have-you? Yes. Embrace the heresy.

As for tech companies, scientists and Star Trek, part of Roddenberry’s genius, in my view, was his marrying empowering technologies that were just beyond our grasp but well within the reach of our imaginations, with a nobler, more enlightened self that could use both that technology and enlightenment to solve formidable problems - a parable for the stuff of human advancement. Every culture, indeed every human being, can relate to this theme because it lies at the foundation of all civilisations. And because Roddenberry’s vision was optimistic, and problems were solved and adversities were overcome, we implicitly accept the proposition that technology can be an able tool for our personal and collective betterment. Genius. Little wonder then that we eagerly anticipate each fresh rollout of newer versions of our devices and services. As fascinating as these tools are, in their own right, their real appeal is in their potential to help us unleash our own. 

For now, I’m still relishing the novelty of having that Picard-esque moment of activating my device to execute some action simply by voicing, ‘Hey Siri’. Perhaps Apple will soon look into replicators.

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