After talks with potential automotive partners stalled, Cupertino could stick with its key iPhone manufacturer to produce an Apple car, a Thursday report from Bloomberg suggests.
This would mark a big change in Apple’s strategy for breaking into the auto industry. The company previously looked to hook up with an established automaker — albeit seemingly with Apple receiving top billing.
Apple’s choices with Apple car
According to the article, Apple has three choices for producing its long-rumored electric vehicle. It could partner with an existing carmaker. It could build its own manufacturing premises. Or it could team up with a contract manufacturer like Foxconn or Magna International.
The first of these options looks less and less viable in light of recent events. Talks with both Hyundai and Nissan seemingly broken down over a variety of issues.
The second of these options looks possible, but expensive. As Bloomberg notes, it would “cost billions of dollars in construction, worker pay and training, along with new liabilities and complex deals with local governments.” Tesla built its own factories, but these cost enormous sums. The electric automaker is only just starting to claw back a profit.
That leaves the third option: the same successful model Apple currently uses to make devices like the iPhone and iPad. Bloomberg described the benefit of partnering with Foxconn or Magna:
“An Apple employee involved in manufacturing said Foxconn is used to having Apple engineers tell it what to do and that the company’s factories are already filled with Apple-designed equipment. The person asked not to be identified discussing sensitive matters.
Magna has some history with Apple, too. The two were in talks to build Apple’s car when the iPhone maker first set out on this path about five years ago. Magna is also a lot more experienced at making cars. It assembles luxury models for companies including BMW, Daimler AG and Jaguar Land Rover.”
Potential help on the Apple Car front
There is some evidence that Foxconn is looking to get in on the Apple car action. It recently began setting up an automotive arm. The company also signed a deal with Chinese EV startup Byton, with plans to start manufacturing vehicles by early 2022. And Foxconn entered into a similar deal with EV company Fisker.
Alternatively, it sounds like Magna might make a good fit for Apple. The Bloomberg report says the “CEO of a well known self-driving car company” was surprised to see Apple talking to existing automakers “when an option like Magna exists.”
You can expect plenty more twists and turns before Apple releases puts its electric car in showrooms. However, if this report proves accurate, it suggests there may finally be some clarity on the approach Apple will take to building its electric vehicle.
Source: Bloomberg
Apple Car could follow iPhone’s successful manufacturing model
