VW boss says threat of Apple car’s overnight success does not worry him

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VW
Rumors of an Apple car continue to roil the automotive industry.
Photo: Sgcdesignco/Unsplash CC

Welcome, Apple…. Seriously.

That, in essence, seems to be the message from Volkswagen chief exec Herbert Diess in a recent interview, responding to rumors about the Apple car.

“The car industry is not a typical tech sector that you could take over at a single stroke,” Diess said in a recent interview with German newspaper Frankfurter Allgemeine Sonntagszeitung. “Apple will not manage that overnight.”

Diess said Apple is following “logical” steps with its car ambitions. “Still, we are not afraid,” he said.

He said VW plans to develop autonomous cars in-house, which will allow it to compete against tech firms like Apple and Tesla.

Apple and VW

This isn’t the first time Diess has chimed in on Apple car. Back in December, he wrote on LinkedIn:

“We look forward to new competitors who will certainly accelerate the transformation of our industry and bring in new skills. The incredible valuation [of Apple] and thus the virtually unlimited access to resources instills a lot of respect in us.”

Apple and VW worked with one another in the past. In 2013, Apple teamed up with Volkswagen to create the iBeetle. This was a VW car, boasting Apple-inspired colors, an iPhone docking station and an app for controlling the car’s features. Apple and VW also supposedly worked together more recently on a self-driving minibus for transporting employees.

More recently, Apple has seemingly been on the lookout for an automotive partner. Initial reports claimed Apple and Hyundai would sign a deal by March, and start production around 2024 in the United States. Now that deal has seemingly fallen through, and Apple’s supposedly talking with Nissan.

Can Apple succeed at cars?

Diess’ comments that there is room for everyone in the automotive world, and it’s unlikely Apple could take over literally overnight, make a lot of sense. (Then again, from Apple’s perspective, it doesn’t need to carve out much of a chunk of the industry to make some seriously big profits.)

But there’s no doubt that tech companies, most notably Tesla, are disrupting the established car companies. At the end of last year, Tesla’s market cap was greater than the nine largest global automakers combined, despite selling a fraction of the vehicles.

Tesla has far more experience than Apple when it comes to building EVs. Its first electric Roadster went on sale in 2008, the year after Apple launched the first iPhone. Unlike Apple, of course, Tesla’s entire business is also far more centered on vehicles.

But by this point, it’s pretty clear that betting against Apple — a company with deeper pockets than any publicly traded company in history — isn’t smart. Especially not when it’s a company with the inherent cool factor of Apple.

Don’t bet against Apple

Dating back at least to the iPod, every new Apple sideways leap has been greeted with skepticism in some corners. Remember the Palm CEO and Microsoft’s Steve Ballmer laughing at the iPhone? Recall Bill Gates’ skepticism about the iPad? Remember those stories about how Fitbit didn’t need to fear Apple Watch? In every case, it seemed like Apple wasn’t going to make much of a dent — until it made a dent.

That’s why I referenced “Welcome … Seriously” up top. For those who don’t get the reference, it’s a quote from Apple’s tongue-in-cheek 1981 newspaper ad “welcoming” IBM to the personal computer industry, a few years after Cupertino helped pioneer it with the Apple II. What happened in that case? The IBM Personal Computer was a massive commercial success.

In other words, it always sounds like overcompensation any time an executive says they’re not worried about a newcomer. Especially, based on recent years, when that newcomer is a $2 trillion-plus giant called Apple.