Apple is about to redefine its definition of the word “mobile.”
After a string of persistent rumors, it looks as if the tech giant has begun working on an electric car. According to the Wall Street Journal, the prototype resembles a minivan, and the project’s name is “Titan.” Rumblings about an Apple car first began after several unmarked vans registered to the company were seen driving around California, and both Tesla Motors and Apple have engaged in some serious poaching wars.
This is obviously uncharted territory for Apple, whose previous experience with transportation includes little more than its flawed Maps app. However, just because Apple hasn’t done it before doesn’t mean its efforts are something to scoff at.
“It’s unclear what Apple’s longterm intentions are, but entering the car manufacturing business would be a big leap, even for a company that has already moved from computers to music to phones,” writes Davey Alba at Wired. “Yet recent changes in the auto industry could give Apple an edge over the companies that have been doing this for a century plus. … The rise of information technology in and around the car—the emphasis on telematics, active safety, and driver and passenger interface—is a very real trend.”
Moreover, Apple also has the capital right now to invest in this type of project. With its recent record-breaking sales quarter, Apple’s market cap tops off at more than $700 billion, which means that conceivably, it could lose several billion dollars working on Titan and still be OK.
However, there is another reason now is a smart time for Apple to get into the car business, and that is the fact that it’s Apple. If you look at the company’s track record, its new direction here not only makes sense in 2015, but also fits in perfectly with its history.
At Apple, the key to success is often less about getting there first and more about making the grandest entrance. “Apple has a history of entering a market late with a much-better product that ends up transforming the category,” notes Dylan Love (a contributor at the Daily Dot) for the International Business Times, referencing the iPhone 6 Plus. “There were plenty of MP3 players before the iPod, tablets before the iPad and even smartphones before the iPhone. … It is not surprising that Apple would be among the last smartphone manufacturers to enter a phone-tablet-hybrid-sized device in the market. The company’s mobile strategy has always had an element of ‘wait and see’ to it, but when it actually does decide to execute on something, it goes big.”
This idea of “going big” is the first reason why Apple’s foray into the world of electric cars makes sense. Obviously, the auto industry has been around for over a hundred years, long before the inception of Apple, but what you might not know is that the electric car has been around almost as long as the car itself. In fact, by the year 1900, there were over 4,000 of them on the road. But the downfall of the electric car was swift and painful. “With developed roads, car owners wanted to go farther than electric car charges allowed,” reports NPR. “Many rural farms stocked jugs of cheap gasoline from newly drilled oil fields in Texas, but few had electricity.”
Though there was some research put into electric cars in the 1970s, they didn’t really come back in a significant way till the mid-’90s, where it began to grow into the niche market it is today. It also hasn’t helped that the oil and auto industries (which just happen to be the two biggest industries in the entire world) have been reticent to give up their stranglehold on the market’s infrastructure. Making way for the electric car would mean changing the way things have been done for decades, which is why the oil companies in particular actively worked to kill electric cars.
But the other unfortunate detriment to electric cars has been a persistent reputation that they are shoddy, impractical, and just generally kind of stupid. This is also where Apple enters the equation: by making electric cars cool. “Any honest early adopter will admit that one of the motivations for jumping on new, untested technology is simple bragging rights,” observes Brad Tuttle at Time. “The decision is at least partly driven by egotistical, not economic considerations—because we all know that prices for new tech will inevitably drop. … And whether it’s a brand-new [electric vehicle], Apple product, 3D TV, or even a fancy ride-on lawn mower, there’s a tendency among all proud new owners to want to show them off and justify the purchase price.”
But just because there is a certain vanity in purchasing the latest, greatest piece of tech doesn’t mean that purchase is ultimately a bad choice. As Richard Meryn at Industry Leaders magazine asserted when rumblings about the Apple Watch started to emerge last year, if the device is to succeed, it’ll be because it’s “practical, fluid, and cool.”
Tesla has been trying to make the electric car cool for a while now, with debatable results. But if you err on the side of “it’s not quite there,” then you’re part of the market giving Apple the chance to prove yet again that it doesn’t have to be first; it just has to be best. It also helps that Apple’s “coolness” in this case is accompanied by the fact that electric cars are good for the environment, and the company has been making an increased push to go green lately.
That said, giving electric cars a hipness factor isn’t the main reason Apple is investing in them. Trying to make a product seem trendy isn’t enough in the tech world. Just look at Google Glass, a product which remains problematic no matter how hard Google tries to make it seem fashionable. Instead, the true key to success in the tech world is innovation, and beyond that, legitimization. Apple hasn’t even released the Apple Watch yet and it’s arguably already become the defining wearable. How’s that for legitimization?
“It’s not the first with a smartwatch or mobile payments system, but Apple is likely to use its market muscle and sense of style and innovation to redefine those categories,” wrote Business Insider’s Sophie Estienne following Apple’s product announcements last September. “With its ambitious series of product announcements, Apple has returned to its familiar formula—without creating any new product categories, it seeks to refine and perfect them to make them a must-have for consumers.”
Ewan Spence at Forbes expressed a similar sentiment when Apple first unveiled its plans for the Apple Watch last September. As Spence saw it, the product was a sign not just of good things to come for Apple, but for the whole smartwatch market at large.
Today’s announcement of the Apple Watch will legitimize public perceptions around smartwatches and wearable technologies; it will reduce the costs and increase the availability of the components involved in smartwatch manufacturing, bringing down the bill of materials and increasing margins; and it offers more retail opportunities for the countless consumers who will be looking outside of Cupertino for their technology, be it for personal preference, platform choice, or pricing considerations.
Now, imagine for a second that Apple could do the same for the electric car, speeding up manufacturing while cutting down on costs. It could also encourage consumers to buy not only the Apple Watch but other companies’ wearables, too, making the industry seem like a truly valid investment. For the moment, Apple has yet to fulfill any of these promises with the Apple Watch, but it already helped to legitimize mp3 players, smartphones, and tablets. If smartwatches are next, then there’s a good chance electric cars will come after.
Apple is great at transforming products people aren’t totally sold on yet. By entering the auto industry, it may end up beating Elon Musk to the punch, finally bringing back the electric car. But more than anything else, it is Apple’s ability to legitimize whatever type of product it creates that should put most doubts about the Apple Car to rest. Apple exceeds at dropping the mic, making sure nothing is the same after the company has had its say, and we shouldn’t be surprised if it changes the auto industry overnight.
Phones were around for hundreds of years before Apple got its hands on them, and look at how that turned out. With the Titan project, it may just pull off the same trick once more.
Photo via jurvetson/Flickr (CC BY 2.0)