Apple Inc. (NASDAQ:AAPL) Planning a Strategic Partnership With Tesla (NASDAQ:TSLA) to Produce Autonomous Car
Apple Inc. (NASDAQ:AAPL) is planning to introduce an electric iCar by entering a strategic partnership with Tesla (NASDAQ:TSLA) according to Wedbush analyst Dan Ives. Ives discussed the company’s electric vehicle ambitions on “Bloomberg The Open” stating that the strategic partnership could be just the first step to that goal.
Apple accelerating plans to make autonomous cars
The strategic partnership will lay the foundation for the company to enter the fast-growing electric vehicle industry. Ives states that for years Apple has been working on an autonomous car vision and the partnership with a leading EV manufacturer will be a good opportunity to tap into the EV space. The EV plans have has many twists in the last six years with the Cupertino-based company scaling down from its initial ramp some years back. However, it appears like the autonomous car plans are gaining momentum according to Ives.
Ives said that based on investor conversations in the last couple of days there is a possibility of the company partnering with an EV producer in 2021. Interestingly the chances of the company unveiling the iCar by 2024 are around 35% to 40% considering the Herculean-like car production requirements involved such as financial model implications, regulatory hurdles, and battery technology. The company will rely on building the car through a partner because of these implications.
Apple considering various EV producers as partners
Ives indicated that because of this, there is a 70% chance that the company will form a strategic partnership in the coming years. This will lay the foundation to start producing its EVs beyond 2025 if the EV venture is successful. Besides Tesla, the company could enter partnerships with Nio Inc. (NYSE:NIO) Volkswagen, and Xpeng Inc. (NYSE:XPEV).
In essence, this means that Apple’s massive TAM will expand aggressively over time as it pursues opportunities in the EV market. Ives noted that over the [past there have been many Apple strategic ideas/products that have never left Apple Park thus it remains to be seen if the company will realize this plan.