The Apple Car Was Meant to Be the ‘Next Big Thing’. What Went Wrong?

Apple has reportedly canned its decades-long effort to build an electric car, with new claims suggesting the ambitious project is now dead in the water. According to Bloomberg reporter Mark Gurman, Apple chief operating officer Jeff Williams and Kevin Lynch, a vice president in charge of the Apple Car, made the announcement internally on Tuesday, much to the surprise of the 2,000 employees working on the project.

A reshuffle will now see employees who worked on the automotive project, known as the Special Projects Group or SPG, shifted to Apple’s artificial intelligence (AI) division. Gurman’s report suggests those employees will focus on generative AI projects, an “increasing priority” for the company and acknowledges “there will be layoffs, but it is unclear how many”.

Apple has reportedly cancelled plans for the Apple Car | Image: Laurenz Heymann

What Went Wrong?

By all accounts, the decision to axe the Apple Car comes somewhat out of the blue, but it must be said that rumours of its demise may well have been exaggerated. Why? Well, the company never officially acknowledged its presence in the first place. Despite whispers that date back as early 2014, an announcement that it was working on autonomous car technology in 2017 and the subsequent hiring of dedicated vehicle engineers from established companies, Apple never once confirmed plans for a standalone vehicle.

The images we saw published online and on social media, including the Vanarama design pictured above, were simply renders or concepts; artist impressions of what could be on the way. With reports suggesting no new progress is being made, they look certain to remain that way.

For Apple, a trillion-dollar company that can seemingly sell anything to anyone, the ‘failure’ feels entirely out of character. For the past two decades, the Wozniak, Jobs and Wayne-founded technology giant has gone from strength to strength, leveraging the remarkable popularity of its flagship iPhone, MacBook and Apple Watch products. When rumours of ‘Project Titan’, a multi-billion play at the burgeoning electric vehicle market first emerged a decade ago, it took little by surprise.

The connected ecosystem that binds Apple’s products was the perfect foundation on which to build an assault on the automotive industry. In a way, it seemed almost inevitable that the technology company would enter the vehicle-production market, with Apple primed to capitalise on the industry’s growing move towards autonomous driving capabilities and tech-heavy electrification. So where did it all go wrong?

Mockup of CarPlay experience set to launch in 2024 in select Aston Martin models | Image: Aston Martin/Apple

Apple Car’s False Start

According to Gurman, a reporter who has followed the project extensively over the past decade, the Apple Car was essentially doomed from the very beginning. The early days were marred by a series of leadership challenges and strategy shifts, and it wasn’t until it fell in the lap of Lynch and William, that the wheels of progress started to turn.

The initial plans were reportedly geared towards a fully autonomous self-driving vehicle that functioned without pedals or a steering wheel, however, as regulations took effect across the globe, the strategy shifted. Reports as recent as last month indicated that the Apple car would arrive much more akin to a Tesla than a pioneering new vehicle, and that may have contributed to its reported cancellation.

In recent years, the EV market has cooled, with vehicle uptake failing to reach initial expectations. Big-name players like Ford and Toyota are prioritising hybrid models and even Tesla acknowledged that its rate of expansion will be “notably lower” this year. Based on this, Apple’s reported decision to step away from vehicle production could largely be put down by economic and industry-specific challenges, and while it might be disappointing for car lovers, Apple shareholders aren’t complaining. When word of the Apple Car cancellation emerged on Tuesday, investors sent Apple shares climbing, with the stock ending up 0.8 per cent in New York.

2024 Tesla Model 3 | Image: Supplied

For now, the Apple Car dream looks almost certainly over, but that isn’t to say the brand isn’t innovating. The company is investing heavily in other areas and the launch of the Apple Vision Pro has been culturally significant, if nothing else. A move into the automotive space would certainly have been interesting but as the Elon Musk-led Tesla, a company that only became profitable in 2020 after 18 years of operation, would tell you – EVs aren’t easy.

In fact, as Bloomberg Intelligence analysts Anurag Rana and Andrew Girard noted, focusing on AI might actually be the best move Apple has made in some time. “Apple’s decision to abandon electric cars and shift resources toward generative AI is a good strategic move, we believe, given the long-term profitability potential of AI revenue streams versus cars.”

So, after a decade of rumours and a string of leaks, we finally bid farewell to an ambitious, if not challenging dream. So long Apple Car, we hardly knew ye.