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I'm a small time Apple shareholder and have the opposite reaction. Apple is sitting on 300 billion in cash - I expect them to do something with it. They need

I'm a small time Apple shareholder and have the opposite reaction. Apple is sitting on 300 billion in cash - I expect them to do something with it. They need to move into some other market because their existing ones are tapped out. Cars are a great fit: 1. Big enough market for an investment of 10s of billions 2. Its international (quit a bit of that money is stuck overseas) 3. Making electric cars isn't too hard (see Tesla) 4. Its a consumer product and they have the best consumer brand which they can easily leverage. 5. The car market is poised to be radically disrupted in the short term - electric cars/self driving cars

eightails 6y ago
> Making electric cars isn't too hard (see Tesla) I don't know, I think Tesla is a good example of how difficult it is to penetrate the car market as a new company. It took them nearly 20 years to get where they are today, and it's not like that was 20 years of smooth sailing. From what I've read they came close to going under multiple times. Aren't they the first major new US car company to start up and not go under since the early 20th century? The situation for Apple is certainly different, given their size and the massive leaps in terms of EV tech compared to when Tesla started out, but let's not trivialise the complexity of the task and the inherent financial expenditure and risk.
- aaaxyz 6y ago
  Tesla's worst year (2017) had them at -3.5B$ cash flow. Apple has 200B$ in cash reserves. With that kind of money they could afford to purchase an existing car company and sustain similar losses for a few decades.
divbzero 6y ago
> Apple is sitting on 300 billion in cash - I expect them to do something with it. “Do something with it” doesn’t have to be reinvesting within the company. Apple has been doing a good job returning excess cash to shareholders, spending roughly $250 billion since 2015 to reduce shares outstanding from 22 billion to 17 billion.
thekyle 6y ago
> Apple is sitting on 300 billion in cash - I expect them to do something with it. Why can't they just pay it out to shareholders and let them figure out how to invest it?
- bufferoverflow 6y ago
  They can, but then their company doesn't grow. Why would you do that?
- ogre_codes 6y ago
  They have been. Apple has returned over half a trillion dollars to shareholders over the past 6 years or so. They have pledged to be cashflow neutral going forward. They do still have a monster cash reserve, but they are also very good to shareholders at the same time. Edit: corrected an order of magnitude error in figures! Thanks umeshunni
  - umeshunni 6y ago
    I think you mean half a trillion
ksec 6y ago
I think the Goal would be Uber, but with a fleet of Apple Cars. I still dont see how selling and servicing Apple Cars would work for Apple if it is sold as an originally car. That large investment and sunk cost would be a good use for its Cash. ( And it would be part of their Services Revenue ) Apple also gets to trial and gather Data with their current Map Data Collection vehicle. The problem is there is nothing, absolutely zero indication that we can crack Level 5 self driving within next 5 years. It is always easy to get the first 80%, the last 20%, the small and minor details will often take as long if not longer than the first 80%. We have just arrived at the 80% point, and there is always the illusion of we are close to Self Driving Goal. And we are not. And apart from that there are no indication as to how Apple is competing with Batteries. Tesla as a car manufacture may be easy to replicate, ( only on a relative scale, it is actually difficult to make cars in mass quantities, especially with Apple that demands perfection. Unlike Tesla ) but Tesla Battery is at least 4 - 5 years ahead of everyone else from both technological and manufacturing. And no have seems to have shown a plausible plan of how Apple is going to tackle this.
- rrrrrrrrrrrryan 6y ago
  Do we need level 5? Waymo has level 4 robotaxis that anyone can request after landing at the Phoenix airport, by just downloading the app. I feel like this use case is sufficient to build a business around.

eightails 6y ago

> Making electric cars isn't too hard (see Tesla) I don't know, I think Tesla is a good example of how difficult it is to penetrate the car market as a new company. It took them nearly 20 years to get where they are today, and it's not like that was 20 years of smooth sailing. From what I've read they came close to going under multiple times. Aren't they the first major new US car company to start up and not go under since the early 20th century? The situation for Apple is certainly different, given their size and the massive leaps in terms of EV tech compared to when Tesla started out, but let's not trivialise the complexity of the task and the inherent financial expenditure and risk.

aaaxyz 6y ago
Tesla's worst year (2017) had them at -3.5B$ cash flow. Apple has 200B$ in cash reserves. With that kind of money they could afford to purchase an existing car company and sustain similar losses for a few decades.

divbzero 6y ago

> Apple is sitting on 300 billion in cash - I expect them to do something with it. “Do something with it” doesn’t have to be reinvesting within the company. Apple has been doing a good job returning excess cash to shareholders, spending roughly $250 billion since 2015 to reduce shares outstanding from 22 billion to 17 billion.

thekyle 6y ago

> Apple is sitting on 300 billion in cash - I expect them to do something with it. Why can't they just pay it out to shareholders and let them figure out how to invest it?

bufferoverflow 6y ago
They can, but then their company doesn't grow. Why would you do that?
ogre_codes 6y ago
They have been. Apple has returned over half a trillion dollars to shareholders over the past 6 years or so. They have pledged to be cashflow neutral going forward. They do still have a monster cash reserve, but they are also very good to shareholders at the same time. Edit: corrected an order of magnitude error in figures! Thanks umeshunni
- umeshunni 6y ago
  I think you mean half a trillion

ksec 6y ago

I think the Goal would be Uber, but with a fleet of Apple Cars. I still dont see how selling and servicing Apple Cars would work for Apple if it is sold as an originally car. That large investment and sunk cost would be a good use for its Cash. ( And it would be part of their Services Revenue ) Apple also gets to trial and gather Data with their current Map Data Collection vehicle. The problem is there is nothing, absolutely zero indication that we can crack Level 5 self driving within next 5 years. It is always easy to get the first 80%, the last 20%, the small and minor details will often take as long if not longer than the first 80%. We have just arrived at the 80% point, and there is always the illusion of we are close to Self Driving Goal. And we are not. And apart from that there are no indication as to how Apple is competing with Batteries. Tesla as a car manufacture may be easy to replicate, ( only on a relative scale, it is actually difficult to make cars in mass quantities, especially with Apple that demands perfection. Unlike Tesla ) but Tesla Battery is at least 4 - 5 years ahead of everyone else from both technological and manufacturing. And no have seems to have shown a plausible plan of how Apple is going to tackle this.

rrrrrrrrrrrryan 6y ago
Do we need level 5? Waymo has level 4 robotaxis that anyone can request after landing at the Phoenix airport, by just downloading the app. I feel like this use case is sufficient to build a business around.