In fact, I think it is nearly impossible for Apple to 'simply' buy BMW, for the reasons you mention above. What I find interesting is that people seem to want to have Apple work together with Tesla, but Mr Cook, however, choose to approach BMW. I get the feeling people here seriously underestimate the technological prowess and know-how of a company like BMW, and that alone is going to be very, very expensive. Apple would definitely *not* be in a bargaining position.
Tim Cook was asked and said Apple has no relationship with Tesla. Apple is a company that likes to do things on its own and control the whole widget. They're not a piece of technology in someone else's product. And they don't typically acquire completel products (at least not on the hardware side). Beats is an exception but we know Apple didn't buy Beats for the headphones. I can see Apple poaching heavily from the auto industry and doing their own thing, A number of Apple employees rumored to be working on this project have auto industry experience. Several Apple designers have prior experience with car design. One designer worked for Audi and Lamborghini prior to coming to Apple. And Apple's CFO previously worked for General Motors. So he clearly has knowledge on the financial and operational side of the car business.
Let's face it, Apple is only approaching BMW because they want the name iDrive for their car, and it bugs the hell out of them it's a i- they don't have. ...I kid I kid.
Some of the comments have been hilarious to bizarre. Be a supplier or die? So Rolex and Movado will close shop any day now because Apple made a watch....sure. Just buy it out right? A 99.5 year old company with a market cap of $80b, assets of $180b, ranked several times over as the most valuable auto brand, 2nd in customer loyalty....is going to sell to Apple for 60b because they may be working on a car. Yeah, ok. Not in my lifetime.
Why is Apple looking at a partnership of some sort at all? Do you how high the barriers of entry are in the auto business? How many auto patents does Apple have? Manufacturing? Service Centers? Regulations? This is more than a hobby to play with. Apple can do it, but having one of the oldest, most respected, most forward looking manufacturers as an ally can only help. There's an old adage: Work smarter, not harder.
Growth? At some point there will be fewer people who want an iPhone that don't already have one. Last year Tim Cook did an interview with WSJD and said iPhone would be Apple's main revenue driver for the next 5 years. What comes after that? Surely Apple executives have to be thinking about that. And what other areas can Apple disrupt that would provide significant revenue/earnings growth?
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
For starters, the stock price will fall, and there will be wealth loss. Once you're a public company, your stock price -- actually, the PE ratio -- reflects assumptions about a certain amount of growth. Unfortunately, a company's performance has to meet or beat those assumptions to maintain, let alone grow, its stock price.
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
Because I don't think Apple's valuation is based on leveling off. The day after earnings on CNBC every show was about what's next with Apple. Right or wrong the market is looking to Apple to disrupt. Not just maintain. And if I was an engineer working at Apple, making incremental updates to iOS devices and Macs would get kind of boring. I'd want to be doing new and challenging things.
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
For starters, the stock price will fall, and there will be wealth loss. Once you're a public company, your stock price -- actually, the PE ratio -- reflects assumptions about a certain amount of growth. Unfortunately, a company's performance has to meet or beat those assumptions to maintain, let alone grow, its stock price.
Stockholders like to see a company that can maintain its success. Most large companies are extremely happy if they grow a mere 5-10%. Apple's stock price might initially go down, but many who shy away from the stock now because they think it's too volatile will buy in, and the stock could actually rise.
Stockholders like to see a company that can maintain its success. Most large companies are extremely happy if they grow a mere 5-10%. Apple's stock price might initially go down, but many who shy away from the stock now because they think it's too volatile will buy in, and the stock could actually rise.
Um... You're overthinking this.
Say you bought a stock for $10. Which option would you prefer? Option 1: It goes to $12. Option 2: It goes to $5 and then goes up up o $7. (There's only one correct answer).
Whats great about Apple going into the Auto business?
Think about it. How long do you keep your car?
5 years? 10 years?
The average person probably keeps their car for 6 years. So if you buy an AppleCar do you really think that person is going to move away from an iPhone? HELL NO.
Every AppleCar sale is almost a guarantee sale of 3 or 4 iPhones in the future.
The average person in the U.S. actually now keeps their car for 12 years. So in your view, that would be a good thing because those people are not going to give up their Apple phones (although that depends upon how tightly Apple locks down the system). But it also means a very long replacement cycle. But auto manufacturing is a very expensive business and you can't use that to drive (sic) the phone business.
I might be in the minority, but as I've said many times before I really don't think Apple is going to build a car. Partnering with someone and sticking an Apple logo on an existing car and controlling the entertainment systems, maybe. Car manufacturing is extremely low margin and requires huge capital investment. And you can't farm out the manufacturing - you have to open your own plants (at least no company so far has farmed out their manufacturing). Most of the profits in the car industry come from selling financing and accessories.
How much would Wall Street punish Apple stock if they entered a business that wasn't going to earn profits for many years and was low margin even when it did start earning profits? When there's a problem with a computer, Pad, phone or watch, you quickly send out a software update. When there's a problem with a car, people can die and the Government steps in. Look at the current massive air bag recalls and lawsuits. I really don't think this is a business Apple wants to get into. Manufacturing the entertainment and communications system? Maybe.
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
If it were a private company, no problem. But being a public company, it always has to grow or Wall Street will kill the stock. Although Apple is obviously managed quite well, that's one of the problem with capitalism, because public companies look at the short term, not the long term. They're obsessed with the next quarter or only the current fiscal year instead of five years from now.
While I don't agree with the solution, this is one of the reasons why Hillary Clinton is proposing that the lower long-term capital gains tax rate be changed from having to hold a stock for only one year to five years. She feels it will force companies to look at the longer term.
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
Because I don't think Apple's valuation is based on leveling off. The day after earnings on CNBC every show was about what's next with Apple. Right or wrong the market is looking to Apple to disrupt. Not just maintain. And if I was an engineer working at Apple, making incremental updates to iOS devices and Macs would get kind of boring. I'd want to be doing new and challenging things.
What markets are there left to disrupt in a truly meaningful way? What relatively new markets, or severely undeserved markets are left in the computing world? There is such a thing as trying to hard, or assuming you'll be successful everywhere because you were highly successful elsewhere. If Apple tries to disrupt a market, and fails to do so the stock will come down.
I believe it's much better to continually grow what you're good at. Stockholders love longevity, and if Apple can demonstrate that they can sell hundreds of millions of high end high margin smartphones long term then more stockholders will buy in.
Stockholders like to see a company that can maintain its success. Most large companies are extremely happy if they grow a mere 5-10%. Apple's stock price might initially go down, but many who shy away from the stock now because they think it's too volatile will buy in, and the stock could actually rise.
Um... You're overthinking this.
Say you bought a stock for $10. Which option would you prefer? Option 1: It goes to $12. Option 2: It goes to $5 and then goes up up o $7. (There's only one correct answer).
And you're over simplifying it. Stocks don't just grow or drop to a point, and stop. Look at ImClone, their drug failed to get FDA approval and the stock tumbled, they then reformulated the drug and got approval which sent the stock up big time. Had Martha Stewart just waited it out she would've gained millions instead of going to jail.
And you're over simplifying it. Stocks don't just grow or drop to a point, and stop. Look at ImClone, their drug failed to get FDA approval and the stock tumbled, they then reformulated the drug and got approval which sent the stock up big time. Had Martha Stewart just waited it out she would've gained millions instead of going to jail.
I am not. It's a rather simple and obvious question, and happens to stocks all the time. I could give you dozens of examples (but won't).
Btw, pulling out one data point of ImClone and Martha Stewart does not empirical evidence make.
Not if you have complete control of said puck. Then you're in command of where others skate to.
Well, that's true, but in that case you're still skating to where the puck will be! I just meant in broader terms I guess, Apple is skating to where Tech will be. The Car is clearly a big one along with wearables. I guess they could make a washing machine if they wanted to, but the thing about the Car is that it incorporates and has the potential to incorporate many things Apple is good at, not just one or two.
I might be in the minority, but as I've said many times before I really don't think Apple is going to build a car. Partnering with someone and sticking an Apple logo on an existing car and controlling the entertainment systems, maybe. Car manufacturing is extremely low margin and requires huge capital investment. And you can't farm out the manufacturing - you have to open your own plants (at least no company so far has farmed out their manufacturing).
You need to familiarize yourself with Magna International.
Comments
Tim Cook was asked and said Apple has no relationship with Tesla. Apple is a company that likes to do things on its own and control the whole widget. They're not a piece of technology in someone else's product. And they don't typically acquire completel products (at least not on the hardware side). Beats is an exception but we know Apple didn't buy Beats for the headphones. I can see Apple poaching heavily from the auto industry and doing their own thing, A number of Apple employees rumored to be working on this project have auto industry experience. Several Apple designers have prior experience with car design. One designer worked for Audi and Lamborghini prior to coming to Apple. And Apple's CFO previously worked for General Motors. So he clearly has knowledge on the financial and operational side of the car business.
Let's face it, Apple is only approaching BMW because they want the name iDrive for their car, and it bugs the hell out of them it's a i- they don't have. ...I kid I kid.
Some of the comments have been hilarious to bizarre. Be a supplier or die? So Rolex and Movado will close shop any day now because Apple made a watch....sure. Just buy it out right? A 99.5 year old company with a market cap of $80b, assets of $180b, ranked several times over as the most valuable auto brand, 2nd in customer loyalty....is going to sell to Apple for 60b because they may be working on a car. Yeah, ok. Not in my lifetime.
Why is Apple looking at a partnership of some sort at all? Do you how high the barriers of entry are in the auto business? How many auto patents does Apple have? Manufacturing? Service Centers? Regulations? This is more than a hobby to play with. Apple can do it, but having one of the oldest, most respected, most forward looking manufacturers as an ally can only help. There's an old adage: Work smarter, not harder.
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
For starters, the stock price will fall, and there will be wealth loss. Once you're a public company, your stock price -- actually, the PE ratio -- reflects assumptions about a certain amount of growth. Unfortunately, a company's performance has to meet or beat those assumptions to maintain, let alone grow, its stock price.
Because I don't think Apple's valuation is based on leveling off. The day after earnings on CNBC every show was about what's next with Apple. Right or wrong the market is looking to Apple to disrupt. Not just maintain. And if I was an engineer working at Apple, making incremental updates to iOS devices and Macs would get kind of boring. I'd want to be doing new and challenging things.
Stockholders like to see a company that can maintain its success. Most large companies are extremely happy if they grow a mere 5-10%. Apple's stock price might initially go down, but many who shy away from the stock now because they think it's too volatile will buy in, and the stock could actually rise.
Um... You're overthinking this.
Say you bought a stock for $10. Which option would you prefer? Option 1: It goes to $12. Option 2: It goes to $5 and then goes up up o $7. (There's only one correct answer).
Whats great about Apple going into the Auto business?
Think about it. How long do you keep your car?
5 years? 10 years?
The average person probably keeps their car for 6 years. So if you buy an AppleCar do you really think that person is going to move away from an iPhone? HELL NO.
Every AppleCar sale is almost a guarantee sale of 3 or 4 iPhones in the future.
The average person in the U.S. actually now keeps their car for 12 years. So in your view, that would be a good thing because those people are not going to give up their Apple phones (although that depends upon how tightly Apple locks down the system). But it also means a very long replacement cycle. But auto manufacturing is a very expensive business and you can't use that to drive (sic) the phone business.
I might be in the minority, but as I've said many times before I really don't think Apple is going to build a car. Partnering with someone and sticking an Apple logo on an existing car and controlling the entertainment systems, maybe. Car manufacturing is extremely low margin and requires huge capital investment. And you can't farm out the manufacturing - you have to open your own plants (at least no company so far has farmed out their manufacturing). Most of the profits in the car industry come from selling financing and accessories.
How much would Wall Street punish Apple stock if they entered a business that wasn't going to earn profits for many years and was low margin even when it did start earning profits? When there's a problem with a computer, Pad, phone or watch, you quickly send out a software update. When there's a problem with a car, people can die and the Government steps in. Look at the current massive air bag recalls and lawsuits. I really don't think this is a business Apple wants to get into. Manufacturing the entertainment and communications system? Maybe.
I never get the obsession with growth. Why does Apple have to continually disrupt markets? Even if sales of iPhones level off Apple will still make billions of dollars in profits whilst the competition makes none or a fraction of that. How is that bad?
If it were a private company, no problem. But being a public company, it always has to grow or Wall Street will kill the stock. Although Apple is obviously managed quite well, that's one of the problem with capitalism, because public companies look at the short term, not the long term. They're obsessed with the next quarter or only the current fiscal year instead of five years from now.
While I don't agree with the solution, this is one of the reasons why Hillary Clinton is proposing that the lower long-term capital gains tax rate be changed from having to hold a stock for only one year to five years. She feels it will force companies to look at the longer term.
What markets are there left to disrupt in a truly meaningful way? What relatively new markets, or severely undeserved markets are left in the computing world? There is such a thing as trying to hard, or assuming you'll be successful everywhere because you were highly successful elsewhere. If Apple tries to disrupt a market, and fails to do so the stock will come down.
I believe it's much better to continually grow what you're good at. Stockholders love longevity, and if Apple can demonstrate that they can sell hundreds of millions of high end high margin smartphones long term then more stockholders will buy in.
And you're over simplifying it. Stocks don't just grow or drop to a point, and stop. Look at ImClone, their drug failed to get FDA approval and the stock tumbled, they then reformulated the drug and got approval which sent the stock up big time. Had Martha Stewart just waited it out she would've gained millions instead of going to jail.
I am not. It's a rather simple and obvious question, and happens to stocks all the time. I could give you dozens of examples (but won't).
Btw, pulling out one data point of ImClone and Martha Stewart does not empirical evidence make.
We have a 2015 Audi S5 Cab. and I think the console and it's functionality are the worst I've ever encountered. The auto however is a thing of beauty.
Exactly. you've got to skate to where the puck is going to be.
Not if you have complete control of said puck. Then you're in command of where others skate to.
Not if you have complete control of said puck. Then you're in command of where others skate to.
Well, that's true, but in that case you're still skating to where the puck will be!
Better to be a suppler, than file for bankruptcy. The disruption is coming, find your place, or disappear forever.
You mean like all the watchmakers around the world who have now disappeared forever since the launch of Apple Watch?
You need to familiarize yourself with Magna International.
http://www.magna.com/capabilities/vehicle-engineering-contract-manufacturing/product-services/contract-manufacturing/complete-vehicle-production
Better to be a suppler, than file for bankruptcy. The disruption is coming, find your place, or disappear forever.
Hyperbole much?