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> I still don't understand what's the game that Apple is trying to play here. It's a fair question, which was also raised when the iPod was introduced. It help

> I still don't understand what's the game that Apple is trying to play here. It's a fair question, which was also raised when the iPod was introduced. It helps to see Apple as an "affordable luxury smart things" company. Dumb, ICE-based cars were a poor fit, but smart, mostly solid-state vehicles may not be. Automotive is just another product category large enough to matter to Apple. A possibility not mentioned in the article is that Apple may initially partner, as they did with Motorola for the ROKR (but hopefully more successfully). Sony, the company Apple wanted to be when it grew up, is doing this with Honda for their first car, the Afeela. > Tesla had the advantage of being the first mover in the EV market… Apple has gone up against several first-movers that are now gone or are shadows of their former selves. It's neat that Tesla will be remembered as people's first EV, but it's not enough to ensure their market position 20 years from now. Tesla has no special sauce that I'm aware of.

jim0266 3y ago
The "special sauce" for Tesla is in the manufacturing, or as Elon Musk likes to say, "the machine that built the machine." Musk has built a corporate culture that drives innovation and change at breakneck speeds. Seek out a few Joe Justice videos to dive deeper into this. Tesla has upended the way cars are being built with mega casting and structural battery packs. Their next-gen car will be another step change with the "unboxed" method. The odds of anyone catching Tesla is about nil. Apple's chance may be less than that. Are they going to pay BYD to make cars for them and lose that margin?
oh-4-fucks-sake 3y ago
2-3 years ago, I was thinking something similar along the lines of "yeah, why doesn't Apple just stick with computers/phones/peripherals/software." But if anything's become clear in the last few years in the EV market are issues with: reliability, software/firmware, usability, aesthetics, build-quality, and high startup capital requirements. Apple is a perennial expert UX/design/durability/usability. Sure there's been a few boondoggles over slight decreases in QA and quality (butterfly keyboards)--but at the end of the day, most of us still love at least some of their products because they still, usually "just work". Apple is also quite good (whether or not you like it) at building walled gardens. Imagine if Apple released a rock-solid car and an absolutely kick-ass charging network that rivals Tesla's? There's be demand. The biggest, most-obvious reason why Apple could succeed at building a car is that they have massive amounts of cash. The #1 reason these fly-by-night EV startups fail is because they can't handle 5-10 years of negative margins coupled with massive capital costs. Apple could burn billions before their EV division becomes profitable and not even blink.
- mmcconnell1618 3y ago
  I wonder if Apple has been secretly acquiring land or negotiating leases for a charging network. That would be a significant chunk of infrastructure to add to their services segment. Apple One -> Now includes charging your vehicle at no additional cost.
  - DSingularity 3y ago
    And what brought about this idea? Seems absurd frankly. How would they even approach this task? Something like this is either organic, gradual, and before you are famous or it is stealth and as wide as possible. I don’t see them pulling something like this off without everyone noticing.
    - refulgentis 3y ago
      "No one knew what the iPod was for either" is a sort of Godwin-for-Apple-speculation. Once you cross the Rubicon where that's invoked, with no other argument provided, it's been signalled it's rational to connect any dot. But yeah, it's novel that Tim Cook's Apple would lean into something Wall Street would abhor - a low-margin capital-intensive business - for something that sounds out of date (L2 in 2028, n.b. Mercedes is at L3 on highways, even assumes liability. Elon would tell you Tesla is L3, YMMV)
    - doublerebel 3y ago
      Apple already is a major investor and builder of renewable energy farms around the world. They won’t even have to buy the energy, they will already have it.
  - behnamoh 3y ago
    That'd be Apple One Pro. I definitely see them starting to "tierify" their services just like they did their iPhones, Visions, iPads, Macs, etc.
- Angostura 3y ago
  I's add "privacy" to your list
RajT88 3y ago
> Tesla has no special sauce that I'm aware of. At first, Musk's stated goal was to make EV's viable. I feel like that Tesla is well on the way to that, in ways nobody thought possible. Assuming he hasn't changed his mind, there may come a day he just calls it quits. But to your point, I would agree - Tesla has no particular special sauce. I am waiting until Waymo FSD finds its way into consumer cars you can drive all over the country before I buy one of them.
- yreg 3y ago
  Depends on what is meant by special sauce. Tesla is still doing thing in a novel way, things that others follow on. Take e.g. the battery design or gigapresses. I'm not claiming they will keep that edge.
  - threeseed 3y ago
    > the battery design The battery cells and system in the new Cybertruck has been widely panned. The industry is now on par and often exceeding Tesla. And when Toyota releases solid-state batteries it won't even be close.
    - rpmisms 3y ago
      For fast-charging, the Cybertruck battery is an incremental improvement, not the leap everyone wanted. For longevity and cost? The rest of the market can't come close. Tesla's secret sauce is being willing to do things nobody else will do, change the paradigm, all that stuff MBAs want to do but don't know how to do. However, more people are making EVs, so Tesla is using its biggest advantage (supercharger network) to essentially force every other EV buyer to witness what competence looks like. Great move.
      - threeseed 3y ago
        Cybertruck uses the new 4680 batteries which were supposed to offer significantly better performance [1] at lower cost. Instead they are worse than what we have today and there is no evidence that the costs are lower. And the supercharger network is no longer an advantage as almost all EVs will now be using them. [1] https://www.drive.com.au/news/tesla-model-y-cost-to-reduce-4680-battery/ https://www.drive.com.au/news/tesla-model-y-cost-to-reduce-4...
madeofpalk 3y ago
> It's a fair question, which was also raised when the iPod was introduced. I don't know. Benefit of hindsight, but you can see the line between computers and iPod. The line from selling iphones and rent seeking on casinos for children to CAR seems less clear to me.
parl_match 3y ago
> Tesla has no special sauce that I'm aware of. Manufacturing of both cars and batteries. That's vertical integration. While I think their current overselling of Autopilot is going to be a folly for them, their assistive driving suite alone would be a multi billion dollar business. They have taken on a ton of risk, and they certainly have their problems, but their successes are substantial and are nothing to wave away.
- kibwen 3y ago
  > Manufacturing of both cars and batteries. That's vertical integration. Tesla is building their own battery packs, but they're still buying the cells from Panasonic, just like everyone else (Apple included) has the option to do.
  - TaylorAlexander 3y ago
    Unless I’ve misunderstood something, this is incorrect. According to this October article Tesla has produced 20 million of their own battery cells at their Texas gigafactory: https://electrek.co/2023/10/11/tesla-4680-battery-cell-production-breakthrough/ https://electrek.co/2023/10/11/tesla-4680-battery-cell-produ... And their first gigafactory in Nevada as far as I know has been producing cells for years. I suspect they stopped buying cells from Panasonic years ago.
    - yasuocidal 3y ago
      Tesla has a special deal with panasonic[0], maybe they ""colab"" on the development of the batteries [0]https://www.tesla.com/blog/panasonic-enters-supply-agreement-tesla-motors-supply-automotivegrade-battery-c https://www.tesla.com/blog/panasonic-enters-supply-agreement...
      - TaylorAlexander 3y ago
        Ah I looked for something more current and it seems Panasonic is operating production inside of Tesla's factory: https://www.theverge.com/2019/4/11/18305976/tesla-panasonic-gigafactory-batteries-model-3 https://www.theverge.com/2019/4/11/18305976/tesla-panasonic-...
annexrichmond 3y ago
> Dumb, ICE-based cars were a poor fit Our "dumb" Audi A6 ICE vehicle has just as good or better self driving and parking as most EVs on the market, so not sure why we are coupling these together.
- CharlesW 3y ago
  You’re right that it’s unfair to exceptions, of which there aren’t many in terms of cars on the road. My point was just that the combination of spatial computing + EVs is where an Apple entry starts to make sense.
- kelnos 3y ago
  Yeah, I thought that was weird. A modern ICE car and modern EV made by the same manufacturer have the same levels of smartness, generally.
- fastball 3y ago
  The point is that Apple is all about coming across as innovative and trailblazey while also being premium. Smart features and build quality is the premium half of the equation, being an EV is still innovative/trailblazey. Your car isn't gonna feel innovative in 2028 if it is an ICE vehicle.
  - deleted 3y ago
    [deleted]
  - annexrichmond 3y ago
    > Your car isn't gonna feel innovative in 2028 if it is an ICE vehicle Couldn't disagree more. Again, our Audi A6 is much more advanced feature-wise than any Tesla on the market. That can continue to be true as the software, torque vectoring, AWD, air suspension, MPGs, assisted driving, etc all improves.
    - fastball 3y ago
      You're talking about incremental improvements, when I say innovative I mean Apple wants more Blackberry -> iPhone moments, not "our car has better suspension". You might really like your Audi and think its advanced features are much better than what you'll find in a Tesla, but the market couldn't disagree more with you about which company is more "innovative".
mattmaroon 3y ago
Also of note: while Tesla sells half of EVs, that’s still a small share. It’s not hard to imagine EVs as a whole still being at single digit market share in 2028. It’s one thing to compete with iOS and Android, where the combined market share is nearly 100%. It’s another to compete with players who don’t add up to 10%, the market is still wide open. Tesla’s special sauce, currently, is their charging network. I’ve driven both Tesla’s and non-Tesla EV’s. The public charging experience for Tesla is considerably better. I guess when everyone adopts NACS in the next year that may change though.
foobiekr 3y ago
Apple will never build cars. Each dollar of car revenue will hurt their margins. It doesn't matter how lux the car is or the target market, it isn't going to happen. Tesla isn't going to be able to hold their margins, either. It's going to be more like Nvidia - Nvidia captures all of the margin in the servers - with some going to Intel or AMD - and SuperMicro, Lenovo, HPE, etc. eke out their existence on the low value chassis.
- moondev 3y ago
  Don't you need CPUs, PCIE lanes, NVME and cooling systems to deploy GPGPU(s) and DPU(s) - or are you suggesting hopper will replace it?
  - foobiekr 3y ago
    Nobody needs DPUs. It’s a fake market. The stuff you’re listing, other than CPUs, which I explicitly called out as going to Intel and AMD, is ultra low margin.
philistine 3y ago
It’s much simpler to me than all that. To maintain the growth percentages that Apple has seen, there are only a few markets that Apple can enter to make enough money to keep growing at the same rate. Otherwise growth stops and then the stock price tanks. So Apple needs to get into American healthcare, cars, or housing. The fact they chose cars is not that it’s a natural fit. It’s that it’s the only fit.

jim0266 3y ago

The "special sauce" for Tesla is in the manufacturing, or as Elon Musk likes to say, "the machine that built the machine." Musk has built a corporate culture that drives innovation and change at breakneck speeds. Seek out a few Joe Justice videos to dive deeper into this. Tesla has upended the way cars are being built with mega casting and structural battery packs. Their next-gen car will be another step change with the "unboxed" method. The odds of anyone catching Tesla is about nil. Apple's chance may be less than that. Are they going to pay BYD to make cars for them and lose that margin?

oh-4-fucks-sake 3y ago

2-3 years ago, I was thinking something similar along the lines of "yeah, why doesn't Apple just stick with computers/phones/peripherals/software." But if anything's become clear in the last few years in the EV market are issues with: reliability, software/firmware, usability, aesthetics, build-quality, and high startup capital requirements. Apple is a perennial expert UX/design/durability/usability. Sure there's been a few boondoggles over slight decreases in QA and quality (butterfly keyboards)--but at the end of the day, most of us still love at least some of their products because they still, usually "just work". Apple is also quite good (whether or not you like it) at building walled gardens. Imagine if Apple released a rock-solid car and an absolutely kick-ass charging network that rivals Tesla's? There's be demand. The biggest, most-obvious reason why Apple could succeed at building a car is that they have massive amounts of cash. The #1 reason these fly-by-night EV startups fail is because they can't handle 5-10 years of negative margins coupled with massive capital costs. Apple could burn billions before their EV division becomes profitable and not even blink.

mmcconnell1618 3y ago
I wonder if Apple has been secretly acquiring land or negotiating leases for a charging network. That would be a significant chunk of infrastructure to add to their services segment. Apple One -> Now includes charging your vehicle at no additional cost.
- DSingularity 3y ago
  And what brought about this idea? Seems absurd frankly. How would they even approach this task? Something like this is either organic, gradual, and before you are famous or it is stealth and as wide as possible. I don’t see them pulling something like this off without everyone noticing.
  - refulgentis 3y ago
    "No one knew what the iPod was for either" is a sort of Godwin-for-Apple-speculation. Once you cross the Rubicon where that's invoked, with no other argument provided, it's been signalled it's rational to connect any dot. But yeah, it's novel that Tim Cook's Apple would lean into something Wall Street would abhor - a low-margin capital-intensive business - for something that sounds out of date (L2 in 2028, n.b. Mercedes is at L3 on highways, even assumes liability. Elon would tell you Tesla is L3, YMMV)
  - doublerebel 3y ago
    Apple already is a major investor and builder of renewable energy farms around the world. They won’t even have to buy the energy, they will already have it.
- behnamoh 3y ago
  That'd be Apple One Pro. I definitely see them starting to "tierify" their services just like they did their iPhones, Visions, iPads, Macs, etc.
Angostura 3y ago
I's add "privacy" to your list

RajT88 3y ago

> Tesla has no special sauce that I'm aware of. At first, Musk's stated goal was to make EV's viable. I feel like that Tesla is well on the way to that, in ways nobody thought possible. Assuming he hasn't changed his mind, there may come a day he just calls it quits. But to your point, I would agree - Tesla has no particular special sauce. I am waiting until Waymo FSD finds its way into consumer cars you can drive all over the country before I buy one of them.

yreg 3y ago
Depends on what is meant by special sauce. Tesla is still doing thing in a novel way, things that others follow on. Take e.g. the battery design or gigapresses. I'm not claiming they will keep that edge.
- threeseed 3y ago
  > the battery design The battery cells and system in the new Cybertruck has been widely panned. The industry is now on par and often exceeding Tesla. And when Toyota releases solid-state batteries it won't even be close.
  - rpmisms 3y ago
    For fast-charging, the Cybertruck battery is an incremental improvement, not the leap everyone wanted. For longevity and cost? The rest of the market can't come close. Tesla's secret sauce is being willing to do things nobody else will do, change the paradigm, all that stuff MBAs want to do but don't know how to do. However, more people are making EVs, so Tesla is using its biggest advantage (supercharger network) to essentially force every other EV buyer to witness what competence looks like. Great move.
    - threeseed 3y ago
      Cybertruck uses the new 4680 batteries which were supposed to offer significantly better performance [1] at lower cost. Instead they are worse than what we have today and there is no evidence that the costs are lower. And the supercharger network is no longer an advantage as almost all EVs will now be using them. [1] https://www.drive.com.au/news/tesla-model-y-cost-to-reduce-4680-battery/ https://www.drive.com.au/news/tesla-model-y-cost-to-reduce-4...

madeofpalk 3y ago

> It's a fair question, which was also raised when the iPod was introduced. I don't know. Benefit of hindsight, but you can see the line between computers and iPod. The line from selling iphones and rent seeking on casinos for children to CAR seems less clear to me.

parl_match 3y ago

> Tesla has no special sauce that I'm aware of. Manufacturing of both cars and batteries. That's vertical integration. While I think their current overselling of Autopilot is going to be a folly for them, their assistive driving suite alone would be a multi billion dollar business. They have taken on a ton of risk, and they certainly have their problems, but their successes are substantial and are nothing to wave away.

kibwen 3y ago
> Manufacturing of both cars and batteries. That's vertical integration. Tesla is building their own battery packs, but they're still buying the cells from Panasonic, just like everyone else (Apple included) has the option to do.
- TaylorAlexander 3y ago
  Unless I’ve misunderstood something, this is incorrect. According to this October article Tesla has produced 20 million of their own battery cells at their Texas gigafactory: https://electrek.co/2023/10/11/tesla-4680-battery-cell-production-breakthrough/ https://electrek.co/2023/10/11/tesla-4680-battery-cell-produ... And their first gigafactory in Nevada as far as I know has been producing cells for years. I suspect they stopped buying cells from Panasonic years ago.
  - yasuocidal 3y ago
    Tesla has a special deal with panasonic[0], maybe they ""colab"" on the development of the batteries [0]https://www.tesla.com/blog/panasonic-enters-supply-agreement-tesla-motors-supply-automotivegrade-battery-c https://www.tesla.com/blog/panasonic-enters-supply-agreement...
    - TaylorAlexander 3y ago
      Ah I looked for something more current and it seems Panasonic is operating production inside of Tesla's factory: https://www.theverge.com/2019/4/11/18305976/tesla-panasonic-gigafactory-batteries-model-3 https://www.theverge.com/2019/4/11/18305976/tesla-panasonic-...

annexrichmond 3y ago

> Dumb, ICE-based cars were a poor fit Our "dumb" Audi A6 ICE vehicle has just as good or better self driving and parking as most EVs on the market, so not sure why we are coupling these together.

CharlesW 3y ago
You’re right that it’s unfair to exceptions, of which there aren’t many in terms of cars on the road. My point was just that the combination of spatial computing + EVs is where an Apple entry starts to make sense.
kelnos 3y ago
Yeah, I thought that was weird. A modern ICE car and modern EV made by the same manufacturer have the same levels of smartness, generally.
fastball 3y ago
The point is that Apple is all about coming across as innovative and trailblazey while also being premium. Smart features and build quality is the premium half of the equation, being an EV is still innovative/trailblazey. Your car isn't gonna feel innovative in 2028 if it is an ICE vehicle.
- deleted 3y ago
  [deleted]
- annexrichmond 3y ago
  > Your car isn't gonna feel innovative in 2028 if it is an ICE vehicle Couldn't disagree more. Again, our Audi A6 is much more advanced feature-wise than any Tesla on the market. That can continue to be true as the software, torque vectoring, AWD, air suspension, MPGs, assisted driving, etc all improves.
  - fastball 3y ago
    You're talking about incremental improvements, when I say innovative I mean Apple wants more Blackberry -> iPhone moments, not "our car has better suspension". You might really like your Audi and think its advanced features are much better than what you'll find in a Tesla, but the market couldn't disagree more with you about which company is more "innovative".

mattmaroon 3y ago

Also of note: while Tesla sells half of EVs, that’s still a small share. It’s not hard to imagine EVs as a whole still being at single digit market share in 2028. It’s one thing to compete with iOS and Android, where the combined market share is nearly 100%. It’s another to compete with players who don’t add up to 10%, the market is still wide open. Tesla’s special sauce, currently, is their charging network. I’ve driven both Tesla’s and non-Tesla EV’s. The public charging experience for Tesla is considerably better. I guess when everyone adopts NACS in the next year that may change though.

foobiekr 3y ago

Apple will never build cars. Each dollar of car revenue will hurt their margins. It doesn't matter how lux the car is or the target market, it isn't going to happen. Tesla isn't going to be able to hold their margins, either. It's going to be more like Nvidia - Nvidia captures all of the margin in the servers - with some going to Intel or AMD - and SuperMicro, Lenovo, HPE, etc. eke out their existence on the low value chassis.

moondev 3y ago
Don't you need CPUs, PCIE lanes, NVME and cooling systems to deploy GPGPU(s) and DPU(s) - or are you suggesting hopper will replace it?
- foobiekr 3y ago
  Nobody needs DPUs. It’s a fake market. The stuff you’re listing, other than CPUs, which I explicitly called out as going to Intel and AMD, is ultra low margin.

philistine 3y ago

It’s much simpler to me than all that. To maintain the growth percentages that Apple has seen, there are only a few markets that Apple can enter to make enough money to keep growing at the same rate. Otherwise growth stops and then the stock price tanks. So Apple needs to get into American healthcare, cars, or housing. The fact they chose cars is not that it’s a natural fit. It’s that it’s the only fit.