Bloomberg News reported on the 27th (local time) that Apple is assessing that its future growth engine has disappeared after the company virtually gave up electric vehicles to focus on artificial intelligence (AI) and augmented reality headsets, which have recently become hot topics on Wall Street.
Apple announced to its employees via email that day that it was finishing the electric vehicle project and reassigning electric vehicle employees to the AI department.
Apple has been promoting electric self-driving cars under the name ‘Project Titan’ as the next generation of food for about 10 years.
Apple’s move is being welcomed by the market. On this day, the market welcomed the decision, with Apple’s stock price rising by about 1% on the New York Stock Exchange.
By giving up electric vehicles, Apple is expected to be able to focus on generative AI and Apple’s new product, the ‘Vision Pro’ headset.
However, Bloomberg pointed out that this decision means that Apple’s future growth engine has disappeared.
This is because the recently released Vision Pro will not make a significant contribution to Apple’s growth in the next few years. In the case of Vision Pro, which combines virtual reality and augmented reality, it will take several more years for it to become a major source of revenue for Apple, Bloomberg predicted.
The technology has excited some early adopters, but it has not impressed the general public. Therefore, it is expected that it will take a considerable period of time for this product to be sold universally and emerge as Apple’s flagship product.
If we had continued to pursue electric vehicles, there would not have been immediate profits, but the potential for future growth would have been enormous.
Electric vehicles have long been touted as one of Apple’s next big things, and could anchor consumers more tightly to Apple’s ecosystem.
Xiaomi’s recently unveiled electric vehicle SU7. ⓒ News1If the Apple Car were commercialized, sales of not only the Apple Car but also related products such as the iPhone and iPad would increase.
Expectations for the ‘Apple Car’ were also high in the market. The Apple Car, which is connected to Apple electronic devices such as the iPhone, has been expected to be the smart car of dreams.
Also, autonomous driving itself is the darling of AI. Tesla is also betting its future on self-driving cars. Even though the U.S. electric vehicle market is significantly slowing down, investors are continuing to invest in Tesla because of expectations that self-driving cars will be a ‘game changer.’
Not only American companies but also Chinese companies are making self-driving cars. Xiaomi, China’s leading mobile phone maker, is also focusing on its electric vehicle business.
Xiaomi believes that electric self-driving cars will become the sum of AI and is also paying attention to electric cars. Most big tech companies at home and abroad are not leaving electric vehicles.
In this situation, Apple abandoned electric vehicles. Bloomberg assessed that this could mean kicking away a huge opportunity in the future for short-term profits.
Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.