We have read several reports this year that Apple is negotiating with various car manufacturers about producing the Apple Car. However, none of them have gone well. Now a change in strategy is allegedly imminent.
According to a new Bloomberg report, negotiations with potential manufacturers of the Apple Car have not gone well. Now Apple is reportedly planning a change in strategy. is called it in the report:
Apple Inc. has a tried-and-tested approach to bringing new products to market: It designs in-house, sources its own components and works with a contract manufacturer to build them for sale. As the tech giant plans a foray into the auto market, it could adopt a similar strategy -- working with a lesser-known contract manufacturer -- after talks with some brand-name manufacturers stalled.
Apple Car: “Traditional car manufacturers are hesitant”
Specifically, the report says that talks with manufacturers like Hyundai "have not gone well." Apple has previously pushed a scenario in which the company would develop much of the vehicle's technology, including the autonomous driving system and interior and exterior design, before leaving final production to an established automaker. This year, there have been reports that Apple has considered several different manufacturers, including both Kia and parent company Hyundai. However, the report notes that this is a tough nut to crack for potential competitors in the industry:
A longtime executive at both Apple and Tesla Inc. explained that this would be like Apple asking bitter smartphone rival Samsung Electronics to make the iPhone. Apple wants to challenge the assumptions about how a car works, how the seats are made, what the body looks like and more. A traditional automaker would naturally be hesitant to help such a potentially disruptive competitor.
Will Foxconn end up manufacturing the car?
Apple is said to have even talked to Ferrari last year - also in vain. Now Bloomberg suggests that Apple could instead turn to a contract manufacturer, as is the case with the iPhone - possibly even the established supplier Foxconn:
Apple is more likely to turn to a contract manufacturer because that's the business model they're used to, said Eric Noble, president of consulting firm The CarLab. He believes partnering with an existing automaker would result in a power struggle, as both companies are used to tightly controlling their supply chains. That's why Foxconn and Magna are two main contenders for Apple's business, according to industry insiders.
Foxconn would be a sensible choice in this regard, as the company is already involved in automobile production and has worked with Apple for many years. An Apple employee also noted that Foxconn is used to being told what to do by Apple engineers. In addition, the company's factories are already filled with Apple-designed devices. If the rumor mill is to be believed, Apple could start production in 2024 at the earliest - the use of "groundbreaking battery technology" is expected. (Photo by Foto VDW / Bigstockphoto)
