Wedbush’s Daniel Ives puts odds of 2024 model Apple car at 35%-40%

From a note to clients that landed on my desktop Thursday evening:

Tonight it was confirmed based on reports out of Korea that Hyundai Motor is in initial talks with Apple about cooperating on EVs. We believe Apple is in the early stages of talks and looking at a handful of strategic partnerships and collaborations globally with existing auto makers on the EV front, with Hyundai on the radar…

We would assign the chances of Apple unveiling its own standalone car by 2024 as 35%-40% given the Herculean-like auto production capabilities, battery technology ramp, financial model implications, and regulatory hurdles involved in such a game changing initiative…

This speaks to our view that the chances of a strategic partnerships with the likes of a Tesla, VW, Hyundai or other auto manufacturers in China (e.g., Nio, Xpeng) are in the 70%+ range over the next few years and could lay the groundwork for a dual path (start building its own line of EV autos post 2025) over the next decade if this EV/autonomous venture is successful with consumers.

Maintains Outperform rating and Street-high $160 price target.

My take: Ives likes to be ahead of the Street, and when Apple news breaks he’s often the first analyst out of the box.

8 Comments

  1. Gregg Thurman said:
    I think there is 0% chance of an Apple Car but 2024. That is not to say there will never be an Apple Car, just not by 2024.

    5
    January 8, 2021
  2. Greg Lippert said:
    From one Greg to another Gregg, I agree. Something may come, but doubt an AppleCar by 24.

    1
    January 8, 2021
    • Robert Paul Leitao said:
      @Gregg @Greg: 2021 just began. Apple has had an “Apple Car” concept in development for at least six years. Daniel Ives is reporting Apple is in initial talks with Hyundai. Neither of you believe Apple will deliver volume car production by sometime in 2024. What do you see as the structural impediments to Apple beginning volume production within 48 months? Gregg, IIRC, you are a “car guy.”

      1
      January 8, 2021
      • Gregg Thurman said:
        Yes, I am. I love them, I restore them, but I don’t manufacture them.

        My biggest resistance to an Apple Car by 2024 (assuming Apple is actually planning one), is Apple’s ethos that it be as near perfect at launch as is humanly possible.

        Even with 6 years of development under its belt, considering the huge potential for liability suits, I think Apple would rather enter the market a little later, than sooner.

        Apple’s brand will sell cars. There is no hurry.

        0
        January 8, 2021
  3. Fred Stein said:
    Forget the when and if questions. Ask “what if?”

    See prior article on TSMC. If Apple builds a car, they will have the most secure, advanced sensors and control electronics by far.

    While Tesla is way ahead of all the legacy car makers in sensors and control, they’re no match for Apple. They face the same problem as legacy car makers, mainly how to upgrade these critical components while maintaining revenue.

    3
    January 8, 2021
  4. Jerry Doyle said:
    Little doubt Apple is coming forth with an Apple car.

    Apple sees acutely the global acceptance and embrace of Tesla cars. Apple does not desire to remain on the sidelines watching Tesla from a distance as Tesla pulls away in the distance. Apple has been watching, studying, assessing and evaluating Tesla for years now all while doing Apple’s own project. This is the way Apple does with pretty much all its initiatives. So, it’s not like Apple is new to the scene. Apple has been monitoring the scene for years while doing their homework. I believe that Apple believes “now” is a propitious time to step out onto the field.

    BTW… Dan’s the man! Unlike most other analysts who spend too much time down in the weeds turning leaves, Dan spends his time raising his head to view the forest. That is why Dan is so discerning with Apple. Dan has a better view and knows what’s coming. 🙂

    1
    January 8, 2021
  5. The integration of more automotive applications into the App Store is inevitable as transport gains more autonomy (any model). One day soon new apps available for download might include: EV Optimize, an app that allows you to get more miles out of your EV. Soccer Parentus, an app that allows soccer Moms to program every drop-off/pick-up in the family AEV (autonomous electric vehicle). Brewery Crawl, users select favorite brewery destinations for their autonomous DD shared ride. Gecko by Geico – truly safe drivers qualify for lower rates but invasive. A similar app already exists. The overall ecosystem may be iOS 17 on an iPhone 15. I would trust my Apple Macintosh AEV to get me there while I nap in the back seat!

    1
    January 8, 2021
  6. David Emery said:
    Could Apple be contracting for prototypes, rather than production? That might be an excellent approach, work with a production company to produce prototype vehicles. It would make A Lot of sense for Apple to understand production issues before jumping into cars. An Apple “Concept Car”?

    0
    January 9, 2021

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