Apple To Chooses Different Path For AI Dominance After Electric Car Project Cancellation

(CTN News) – In a strategic shift, Apple Inc. has reportedly terminated its ambitious electric vehicle project, known internally as Project Titan, marking the end of the tech giant’s decade-long pursuit of entering the automotive industry, as reported by Bloomberg on Tuesday.

Despite relinquishing a potential entry into the lucrative electric vehicle market, Apple seems to have chosen a different path, recognizing the intensifying competition in the automotive sector and the evolving nature of the industry.

The decision to halt Project Titan, which reportedly cost the company around $1 billion annually, comes at a time when the automotive landscape has experienced a downturn, notably with Tesla’s once-soaring valuation showing signs of waning.

Electric Cars in the Wake of Tesla’s Market Challenges

Tesla’s gross profit margin has nearly halved amid a slowdown in demand growth, causing a reevaluation of the electric vehicle market’s attractiveness.

While Tesla’s success played a role in motivating companies like AAPL to venture into electric cars, the business dynamics have shifted.

AAPL, a company valued at $2.8 trillion, sees cars not as an end in themselves but as a means to increase user engagement with its diverse range of services.

With Americans spending an estimated 93 billion hours behind the wheel in 2022, a self-driving vehicle could potentially enable users to interact with Apple’s services, providing valuable data for the company’s artificial intelligence (AI) endeavors.

Unlike traditional automakers like General Motors, which invest heavily in automotive research and development, Apple appears to be focusing on the broader landscape of AI and user data.

The decision to redirect efforts toward generative artificial intelligence indicates Apple’s commitment to staying at the forefront of technological innovation.

 

Apple’s Strategic Pivot: From Electric Cars to AI and Augmented Reality Dominance

For AAPL, the goal isn’t limited to manufacturing cars but extends to mapping and understanding users’ movements, tastes, and habits.

The recently released Vision Pro augmented reality headset and the ubiquitous iPhone already serve as powerful tools for this purpose, delivering superior profit margins compared to the production-intensive automotive industry.

By winding down its electric car project, AAPL is signaling a strategic pivot toward AI and augmented reality technologies, recognizing that the real value lies in user engagement and data analysis rather than the production of physical vehicles.

As the company shifts gears, it remains on course for AI-driven success, demonstrating that the road to innovation doesn’t always involve traveling on four wheels.

Apple’s Electric Car Journey Since 2014

Apparently, Apple’s been working on a car since 2014. It’s been ebbing and flowing over the years. Recently, it was reported Apple would release an electric car around $100,000 in 2028.

Their original plan was to ship a car that was fully autonomous, without steering wheels or pedals. In recent years, those plans have been scaled back a lot.

As far as leadership goes, Doug Field led the Apple Car project. Tesla hired Field away from Apple in 2013 to help ramp up Model 3. Field returned to Apple in 2018 to help lead the Apple Electric Car project, and left for Ford in September.

In a tweet, Elon Musk saluted the news. Musk had promised to ship a car without a steering wheel by 2021, but that obviously didn’t happen.