Morgan Stanley is bullish on the Apple car

“Shared mobility” will be bigger than the iPhone, says Katy Huberty, and Apple has bet the company on it.

Imagine an Uber fleet of self-driving Teslas. That’s where the automobile industry is headed, according to a team of analysts led by Katy Huberty, Morgan Stanley’s chief Apple watcher.

They call it “shared mobility.” Even before Apple’s $1 billion investment in Didi Chuxing, the Uber of China, Apple by Morgan Stanley’s estimate had spent nearly $5 billion in incremental R&D on some kind of auto/auto services project.

That $5 billion estimate is the starting point of the most detailed analysis I’ve seen of Apple’s pivot from smartphones to smartcars. Like Neil Cybart’s Above Avalon analysis two weeks ago and Horace Dediu’s UBS interview this week, Morgan Stanley is convinced that this is Apple’s next big thing.

From today’s report:

  • The shared mobility market is huge, worth $2.6 trillion by 2030 (26% share of 20 trillion total miles driven at 50 cents a mile)
  • It’s right up Apple’s alley, representing the intersection of three disruptive forces: electric, autonomous, shared vehicles
  • Apple is vastly outspending the major auto makers—10 times Tesla and 20 times the rest of the industry.
  • By 2030, Apple’s shared mobility revenue could be $400 billion, more than the rest of Apple generates today ($234 billion)

To give you a sense of the scale of things, here’s an interactive chart that compares Apple total R&D spending to that of the major automakers.

Not seeing the graphic? Try the website. 

9 Comments

  1. Keith Hope said:

    They it “shared mobility.”

    Needs another word in there

    1
    May 25, 2016
  2. Jonathan Mackenzie said:

    I am not convinced that shared mobility is the future. My company does valet services among other things. Most people’s cars are disgusting. Some have various bodily fluids or rotten food. Some people smoke. Others just stink or even worse use so much body spray that you get it on your own clothes for the rest of the day.

    Sure there are already cabs, but the driver exists to make a judgement about whether the car is clean, whether a passenger can smoke, or whether they should leave that opened bottle of, lets say beer, in the car.

    I haven’t heard any discussion of whether cars will return to home base after each trip for detailing or how someone will stop two teenagers from having sex in the back seat (or for example how to deal with vomit).

    If you really imagine a world where cars have no driver and people can summon them instantly and go wherever they want, it seems to me you arrive at place with all the joys of using public transit without any human supervision.

    This is not an insurmountable problem necessarily, but I have heard no reference to it. A shared self driving car will need to do more than stop at red lights. It will need to somehow stay clean.

    1
    May 25, 2016

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