Thread: Apple and Tesla
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Brave Ulysses
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Join Date: Dec 2005
 
2019-05-02, 23:04

Quote:
Originally Posted by kscherer View Post
I don't know. I guess I have a few things to say.

Pros:

- Apple gains a manufacturing partner with at least some experience;
- Tesla is a respected brand;
- Apple gains access to the Gigafactory, which has the [presumed] capability to manufacture all the batteries they could ever want;
- The Gigafactory may also be able to supply batteries for Apple's other product line, so there is an advantage there;
- Apple would immediately have access to hundreds of thousands of new, highly devoted customers who are willing to spend money on quality products

Another pro is that it immediately puts Apple in front as the leading electric car manufacture in a fast growth market. As I mentioned above, it also gives Apple access to the largest fleet of autonomy capable vehicles to provide shadow mode data for neural network autonomous improvements. I also think the vision and ambition of Elon is a pro that Apple needs.


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Cons:

- Elon Musk;
- Quality issues need to be resolved;
- Linux/Ubuntu-based OS would need extensive rebuild;
- Manufacturing capacity needs to be resolved;
- Serious culture clashes (especially regarding Musk and senior managers);
- Branding—Do they change the name to Apple Car? I doubt it (see Beats);
- The Gigafactory is at least partly owned by Panasonic (the actual battery supplier), so there is complication in that;
- Tesla would cost Apple roughly $50billion, with no profitable future in sight; Apple can develop its own car for significantly less than this
Tesla's quality problems are overstated. Again, they are under the microscope. And their buyers are very intelligent and very "plugged in". I don't know of any other car that is as scrutinized at delivery/pickup for "panel gaps" as a Tesla is. Some of this "quality" stuff has created a life of its own.

As for profitability... the funny thing about Tesla is "profitability" is a lot easier to achieve if they have the capital to set the table to achieve it. Starting a mass production car company, in the United States, from scratch, is incredibly expensive..... building out a charging infrastructure to support that is incredibly expensive, building the battery factories from scratch to support that is incredibly expensive... building out the distribution to support that is incredibly expensive.... once that is all done.... there can be profit..... and probably very healthy profit. apple has that capital.... they could turn Tesla profitable far quicker than Tesla can on its own.






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Honestly, I don't think it makes sense. When Apple bought Beats for $3billion, at least Beats was a profitable company under solid, mature leadership. Tesla is struggling to find money and Musk is a loose canon, and that combination would cost Apple $50billion+, depending on the market at time of purchase. Also, it would likely bring Apple into direct competition with their CarPlay partners, and I can see every manufacturer dumping them practically overnight, although I suppose an argument could be made that other car makers would not want to anger their iPhone-owning customers.
Apples to Oranges comparison. The growth potential (and thus revenue and profit potential) in transportation is insanely larger than headphones.

CarPlay... at this point, CarPlay exists because the car buying public has demanded it from auto manufacturers, not because of Apple's partnerships.
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