Electrec reports Apple hires Tesla’s head of electric powertrains in effort to bring electric car to market.
There has long been a debate about Apple’s secretive automotive project being only about a self-driving system for vehicles rather than a full electric autonomous vehicle. It now looks clear that the latter is the case as Apple hires Tesla’s head of electric powertrains.
Earlier this month, we reported on Tesla losing its VP of Engineering behind its latest electric powertrains; Michael Schwekutsch.
When Schwekutsch joined Tesla back in 2015, we described his background: “Michael Schwekutsch joined Tesla last year to lead powertrain developments after a two-decade long career working for legendary third-party powertrain engineering firms like BorgWarner and GKN Driveline. More recently, he managed programs for the electric and hybrid powertrains of the BMW i8, Porsche 918 Spyder, Fiat 500eV, Volvo XC90, among other popular vehicles.”
He is the latest of several top Tesla engineers to join the project, which was for a time thought to only consist of a self-driving system for vehicles after a scale-back of the plan. Now that Schwekutsch, who has exclusively worked on electric powertrains over the last decade, has joined Apple, it is becoming clear that the company plans to bring a complete electric vehicle to market.
Other Announcements
- December 17: Apple hires designer Andrew Kim away from Tesla
- August 23: Apple hired scores of ex-Tesla employees this year, and not just for its car project
- June 19: Apple Poaches Ex-Waymo Senior Engineer for Self-Driving Car Technology
Not So Secretive
Although Apple’s precise plans are unknown, it’s crystal clear Apple plans to directly compete against Tesla.
Apple’s Tremendous Advantages
- No debt
- Apple has money making operations to fund a large project
- Apple won’t put operations in a tent
- Apple can afford to hire and pay the best
- Quality will rise, bumpers will stay on, paint jobs won’t look like a 6-year-old did them, etc.
- The CEO will not make idiotic Tweets or promises, nor will the CEO challenge the SEC.
Tesla cannot possibly survive direct competition from Apple.
The pertinent question is: When does production start?
That’s the secret.
Mike “Mish” Shedlock
Apple can make an electric car and beat Tesla is a myth.
They have zero car manufacturing experience, yes they have a lot of cash but that doesn’t guarantee success. Oil companies also have a lot of cash, and why don’t they produce cars then? Because marking cars requires dedicated people like Elon Musk and there is huge competition among other car manufacturers. Apple is very good to make money if they have less competition but recently they have more rivals and Apple cannot sell iphones more than $1,000, they are losing market share to others and now they are looking for other fields which they have zero experience.
I believe Tesla will stay in the market for many years to come and even if Apple tries to compete with Tesla and becomes successful, Elon Musk can sell his stake to a rival like BMW and encourage other share holders to do that too, then Apple has to compete not with an indebted Tesla but a BMW-Tesla group which has enormous power both manufacturing good cars .
Funny, because I just had a Tesla driver explain to me last week that it is “the iPhone of cars.”
I did not offer my counter-analogy: a Tesla is a fifty-thousand dollar couch you get to sit in during rush hour traffic.
“It takes a giant leap of faith to believe that Apple will be automatically successful in this. “
It takes hardly any faith. Musk did not know how to make cars and arguably he came close to pulling it off. He has too much debt to compete against Apple if the latter gives it a go, and I believe they will.
It does take a giant leap of faith. And you have plenty of it, Mish.
Look, what happened with Google Firefly? Abandoned, because Google does not know how to produce cars or does not want to…
Look, what is happening with Nikola Motors [https://moneymaven.io/mishtalk/economics/anheuser-busch-orders-800-nikola-hydrogen-electric-semi-trucks-where-s-tesla-kvPNH6p6U0SI3FAnLQRUQw/]? I have seen Tesla Semis on roads, but not a single Nikola semi truck. Nikola is vaporware.
Look what happened with Otto that was founded by ex-googleers [https://moneymaven.io/mishtalk/economics/ex-google-engineers-launch-otto-completely-driverless-truck-testing-underway-0VzyXp6MO025fmkee9N6Cg/]. They are shut down.
Not to talk about Germans that keep postponing.
Apple does not do manufacturing. You cannot currently contract out manufacturers for cars. Also, Apple will be very reluctant to accept the low margins of cars.
Bad timing trying to talk up Apple Mish. I mean abandoning AirPower does not inspire confidence, does it?
From February 2001 about Amazon’s debt:
“The pioneering e-commerce company’s stock price continues to slide, losing 88 percent of its value since its peak 14 months ago. Half a dozen Wall Street analysts have downgraded the shares. The company’s fiercest critic says he expects the Internet retailer to run out of money to adequately fund its operations later this year.”
This idea that another company introducing an electric car is going to kill Tesla is ridiculous. There are over ten major car companies currently. If electric propulsion becomes mainstream, then there will be numerous companies that will be successful with electric vehicles. Some will be new car companies and some will be established car companies.
Saw a comment on Zerohedge today: “Tesla will be out of business in less than 5 years. “
Finally Tesla critics have shifted goalposts to have more time reserves for their predictions. For the past 7 years it used to be “Tesla will be out of business by end of this year”.
When, or if, Tesla will be out of business has nothing to with Apple, and everything to do with The Fed and the government.
No different from the banks since 2008/9; Japanese banks and bridges-to-nowhere builders for the past 3 decades; and by this stage of the West’s descent into an undifferentiated financialized hellhole, every other entity as well. As long as keeping Tesla alive benefits well connected leeches; Tesla will be kept alive.
But the dear leader said that Tesla being out of business has a lot to do with Apple. Here is the quote:
Remember: No Dear Leader has ever been right. About anything. Nor useful for anything but target practice. Not one. Ever.
The sat nav could be interesting in the iCar if they use Apple Maps.
Battery technologies will see this through. And someone will hit the battery tech sweet spot. There are lots of robots that will need to come online soon that will require it. The day is coming short of a direct meteor hit. Coal is outdated like whale oil became outdated. My solar overproduces for my needs already and it’s just one house. Charging a car wouldn’t hurt me at all. Solar prices will come down and efficiency will go up. Add a battery to my house that can store 3-550 kWh and we are Golden. Or add a large storage to the neighborhood. Possibilities are huge.
So how many acres of land would you have to clear cut to put in solar panels, which are considered toxic waste at end of life, to charge your Tesla in the same timeframe as grid power? Understanding the capacity factor is at best 17% of name plate values over a years time.
Can you manufacture a solar panel, or a Tesla for that matter, with solar power?
If Solar was even remotely comparable to diesel efficiency wise, for high energy users, the rather cost insensitive US military, operating in the most sun drenched spots on the planet; would have ditched their diesel infrastructure years ago.
There are use cases where solar make sense. Residential structures being one of them. If properly built (which they are not in our financialized dystopia, but then again what is), houses don’t need much power at all for heating, even in Fairbanks. They also have cooling needs that go up in step with solar radiation. Large power draws are intermittent enough that a battery and a big (again well built) water heater of some capacity, is enough to charge a commuter car and keep water warm.
The benefit is not so much efficiency. But rather independence.
The irony is that most old farts on this site will never understand that EVs and Solar is the ultimate libertarian’s wetdream come true.
Hey, I’m an old enough fart that I drove an electric car back in the 70’s. However, the power required to charge a Tesla and the power required to power a Sebring Vanguard are worlds apart. I still believe that a vehicle like the Sebring Vanguard has a place, but these days it seems that a vehicle has to be all things for all people, or it’s nothing. The Sebring Vanguard Citicar had a 6hp motor, weighed 600 lbs, had a maximum range of50 miles (35 was safer), and a top speed of 35mph (30 was a safer bet). It also had no heat or AC.
I would add that the old Citicars still appear on EBay from time to time. There is one now, listed as for parts, or not working, and they want $2300 for it. Usually they say “perfect, but needs tires and batteries”, since the batteries and tires both had to be replaced annually. I think they were $2300 new, so that much for a 40 year old non-working relic is amazing. I guess they are sold to collectors?
That wasn’t a car. It was a motorized coffin.
Back in those days battery and drivetrain tech was not there, so yeah they had to cut quite few corners to make it your only car.
What was whr/mile you were able to get with Citicar?
BTW, If one would drive Tesla Model 3 like a citicar at 35 mph, then Model 3 range would go up from 325 miles to 600+ miles per 1 full charge (based on Hypermiling record done a year ago at that speed). So Model 3 consumption would 125 whr/mile.
My DIY electric bike gets 25 whr/mile and goes as fast as citicar.
I bet that Citicar consumption has to be somewhere in that interval, so it is not really that consumption of Tesla Model 3 and Citicar are out of different worlds.
I agree that they are totally different. The Citicar used 8 deep cycle 6V Marine duty batteries, and those are about 200AHr. So, figure 1200 AHr to go 50 miles. If I did the math right, that’s about 200 whr/mile, however, you couldn’t really completely discharge the lead acid batteries, so you were really only able to use a portion of their rated capacity, so it was probably closer to the 125 w/hr you mention. The Citicar was essentially a faster golf cart with a hard top. Even with only 6hp, it was pretty zippy up to it’s max speed, and they were eerily quiet.
It takes a giant leap of faith to believe that Apple will be automatically successful in this. Apple has done well when it has taken an innovative lead, thinking out of the box to creative new products. It has not done well when competing with established products, purely on the basis of manufacturing. Apple has been an outstanding software company, but has always pictured itself as a hardware company.
Making a car is a massively different than making a phone. Perhaps Apple will be successful, perhaps not. If they succeed, I suspect it will not be because of the automotive technology. Rather it will be because they come up with an innovative, user friendly control interface that will be more intuitive than the current system of buttons, knobs, and random information panels.
Tesla has major issues.
It doesn’t follow iCar is guaranteed success.
That political satire might gey a new meaning.
Apple has well over 100 B in debt.
Important to add, Apple has 84B in cash with 101B in gross profit last quarter. Apple could pay off their debit rather quickly.
Was Tesla ever a viable business entity or did they simply survive with direct and indirect subsidies?
Just like the oil, gas and agribusiness companies survived with susbsidies? You cry when it’s green subsidies but don’t complain much when it’s subsidies for large corps.
The old farts on this site don’t understand that oil is receiving massive subsidies. Here are few examples: GM bailout. Oil wars. Uncovered health expenses through city pollution. Government buying up oil contracts directly (to replenish reserves and also for its consumption), tax deductions.
A thought experiment. If there was a new country that appeared today on Earth out of blue and was not locked in electric or gasoline infrastructure/interests, for which one would they develop infrastructure – gasoline or electric?
If you want answer, then look no further than China. Future is electric. Fossil shills will destroy USA economically if they will keep blindly insist that oil is the future and keep lobbying for laws that support their fossil investment prices.
You guys are with your heads on the clouds that will be the end of Tesla.
Apple makes the most expensive and highest margins on smartphones today because it was born a cult, now it is status.
Tesla is similar, but I argue that Musk’s economic plans for the future holds more sense than Apple’s who is driven mostly by money.
Apple pays dividends, Tesla invests on the future.
Apple got fat, Tesla is like a Rocky Balboa heading to the stairs.
Let’s see who wins. I bet on Tesla, they were studying electric cars when everybody thought was insane, since more than a decade ago. There is no way to go around that with only “money” and hiring (some try stealing: Xpeng, etc).
The challenges are:
1 billion miles of data for FSD, proprietary and dedicated neural net accelerator, the best and lightest electric motors, supercapacitors and dry coating electrodes tech projects, all the codes, Buffalo’s solar panels and upcoming tiles, and the most important, batteries. It may seem that Apple is older than Tesla at this, but be not confused, Tesla already produces batteries at a rate higher than Apple.
Finally, I don’t trust Apple’s battery management systems, with the years they reduce the power of your device to increase charging cycles. That is only because they did not tested it hard enough to guarantee thy quality over the years, or it was bad faith to sell more powerful systems that cannot hold their characteristics over time.
But everyone is welcome to try.
“…they were studying electric cars when everybody thought was insane…”. Really?
Tesla has zero IP. Nothing new. Same old tech.
Tesla = fancy golf cart (literally the exactly same tech)
Tesla fanboys = virtue-signaling morons (try recycling that battery)
If Tesla has zero IP, then explain why:
Thanks for proving my point.
Tesla = nothing new.
Batteries are a shit technology, and both the EV + renewable energy industries 100% depend on batteries.
Green energy & EVs are virtue-signaling fiction. It’s all bullsh*t unless battery tech is revolutionized… and Elon Musk is NOT revolutionizing anything… he’s a SUBSIDIZED snake oil salesman, period.
Riiiiiiight.
I’ll stop posting truth after you explain how .25 ton toxic batteries are “recycled”.
Will Apple call it the iCar?
Even if Apple were to force Tesla to close, Elon Musk is not going away because of the tremendous work Space-X has done for NASA.
What if it’s not a car but a short haul vertical take off and landing aircraft/taxi? Powertrain not to dissimilar and efficiency critical.
There a couple of these companies coming along with booking via phone. Hope across cities to avoid congestion.
There will always be idiots out there. The purpose of progressivism, is to ensure the idiots are also well funded, as long they are the right idiots. Namely the well connected ones.
The others to worry will be the Germans, more so if Apple have a new ownership model in mind to upset the market.
I own zero Apple products but have to admire what they have achieved and they are capable of upsetting old thinking.
More importantly, Apples goal and focus will be on creating a profitable and quality product to satisfy the consumers needs, as opposed to Teslas focus on cultivating and maintaining the cult of personality surrounding Musky Elon…
Remember the same thing being said about Apple when Steve Jobs made it great. Anti-cultists at that time were cheering for IBM and MSFT.
The EV is still a solution in search of a problem…
Apple’s culture isn’t to hire the best, nor is it to pay competitively.
EVs? Apple can’t even deliver a wireless charging pad! I value Mish perspective, but if someone thinks Apple can just make EVs in mass production any time soon, it is a dillusion. This just shows their main market, cell phones, is saturated with nowhere to go but try to jump into other trendy things…They do have a lot of cash to burn, but burn it they will!
Likes of Magna could build the cars. If a premium product and Apple make money from the eco-system (internal entertainment) chances are there’s enough margin.
Also – don’t expect everyone to buy. Future could be a different model, some sort of i-mobility. Owning may not be the Apple way.
Didn’t Google try “Likes of Magna” to produce their cute, now discontinued, self driving car?
From memory BMW and Jaguar have used them OK. Capable and I don’t imagine Apple having their own plant.
Wait a sec…
A company can make EVs without billions in taxpayer monies, without government picking winners/losers and without massive credits for consumers to buy their cars?
As long as The Fed provides a strong enough implicit, even if indirect, guarantee of the paper which is their real moneymaking product, of course they can. Anyone could. Which is exactly what progressivism is all about: All outcomes determined by policy. None by merit.
Will be a money loser for Apple and will cut profitability. Does anyone think an independent can make an EV and make money. As of now there is no business case to own an EV. I don’t think AOC even has one. They are a novelty or status symbol. I personally think Tesla’s are fugly. They are a money loser for the big 3 and like the US budget deficit will remain so as far as the eye can see.
In Silicon Valley I see a lot of Indians and Asians driving Teslas. As an alternative they could have bought a similar ICE car like Audi A4, BMW 3 series or Mercedes C class for the same price. But they didn’t.
As a real life example thanks to driving Model 3 I am saving ~$250 a month in fuel alone (~20K miles/year). Think of it as a dividend that your car is paying to you by going EV.
If right-wing minded people will keep wasting money on ICE cars and gasoline, then their demise is not too far away…
A thought experiment, which investment choice would you prefer to make:
Your math is way off. First you need a battery replacement, and the last time I spoke to a Tesla rep it would cost 8-9k and need to be replaced at 70-80k miles. Plus you don’t know what the depreciation schedule is especially after Tesla goes bankrupt. Also no one know what the reliability of these vehicles are. Still no business case if you do the math correctly. Lastly they are still fugly.
Obviously you did not talk with Tesla representative, because Tesla warranty alone lasts 100K miles (which means Tesla fixes any issues if they do occur)
And there are already Teslas with 300K+ miles on them that still have original battery pack in them while being supercharged at 120KW. I am charging mine gently at ~6KW most of time. My baby will last forever if I treat it like this.
And please, don’t get me started on how much ICE maintenance costs. Are you trying to imply that blown gaskets, alternator failures, transfer case failures, transmission failures don’t happen before 100K miles on ICE cars? And if they happen mechanic will charge me 9$/hour in labor? Get real.
When they launched the model S I spoke with the rep and this is what I was told at that time. I also looked at a Ford hybrid and was told the same about that battery. That was about 3-4 years ago I believe. Whenever the model S was first launched.
I would recommend you to go again and talk with a Tesla representative because you have outdated and conflicting information.
First of all, replacement battery pack when Model S was unveiled did not cost 8-9K.
Second, you really can’t extrapolate in any way non-Tesla battery pack lifespan (hybrid, phev and leafs) to Tesla (and GM Bolt) battery pack lifespan, because they are undersized and don’t have active cooling system. If you want to know how a battery pack that does not have active cooling system degrade then talk with any Nissan Leaf owners from hot climates who are driving Model 3 now.
Yes, I think an independent can and Apple have the benefit of of an already recognised brand with a loyal following and characteristics making it a very valid competitor.
“Does anyone think an independent can make an EV and make money.”
As long as they stick to making high markup fashion accessories, and have the brand cachet allowing them to do so, they can. At least for the duration of a credit bubble.
They can also make money the new fashioned way; by treating, and accounting for, the actual car as nothing more than a marketing exercise, employed to sell what is the real money making product in financialized dystopias: Stocks and bonds.
Late last year i read an article on Seeking Alpha by Paulo Santos, who made great
arguments for an Apple car program. With numerous patents already in or applied for including power train related stuff, a work force larger than Tesla’s early years, and would not be built in house, but , instead from someone such as Magna-Steyr .
Tesla can’t survive vaporware? This is the same day Apple announced they couldn’t make their wireless charging station work and abandoned it.
Exactly, Tesla has been surviving vaporware since 2012.
Is it really different this time? I don’t think so…