Volkswagen CEO isn't sure that Apple wants to build cars

Posted:
in Future Apple Hardware
The CEO of Volkswagen says he's certain Apple intends to expand CarPlay, but doesn't think it's likely to produce its own Apple Car.




Apple has publicly said that it has plans to bring a much enhanced CarPlay to more cars starting in late 2023. Now, though, Volkswagen's Herbert Diess says he suspects that's as far as Apple will go.

"I'm not sure if Apple will actually bring cars to the market in the end," said Diess, as first reported by Reuters. "It would be a big effort."

Diess said this during his opening keynote and Q&A at the start of the hub.berlin conference, which runs for two days from June 22, 2022. It's not clear yet whether he was responding to a question, or whether it was part of his introduction to the event.

According to Reuters, he did speak at the event of his certainty that Apple wants to provide software for what the car industry calls the "cockpit" of vehicles.

And Diess said in 2020 that he was "looking forward" to Apple's self-driving car. "The incredible valuation [of Apple] and thus the virtually unlimited access to resources instills a lot of respect in us," he said, in translation.

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Comments

  • Reply 1 of 32
    DAalsethDAalseth Posts: 2,034member
    I’ve thought the same for a while now. It’s one thing to produce a system that is used in other people’s cars, and making the whole thing yourself. The latter involves setting up a dealer network, service and support systems, dealing with warranty claims and more. The current network of AppleStores would simply not work at all for this. Apple would have to build a new car dealership network from scratch. Apple has experience designing software. It’s another story with seats, air bag systems, wheel bearings, door locks, and all the rest of the stuff that goes into a car. 
    Why reinvent the wheel, when they can make something to go on other people’s products. Far less hassle and far more money to be made in the latter. 
    edited June 22 forgot usernamelorca2770viclauyycdarkvaderMplsPdewme
  • Reply 2 of 32
    robin huberrobin huber Posts: 3,603member
    He may be right. Dashboards may end up like computer monitors of old, a blank slate for whatever OS a driver favors. Nothing to stop auto makers from providing a stock UI, but with a standardized interconnect module, Apple and Android fans can have a seamless experience. 
    forgot usernameCyclistedarkvader
  • Reply 3 of 32
    anantksundaramanantksundaram Posts: 20,322member
    At this point, it seems he's likely right.
    darkvader
  • Reply 4 of 32
    CyclisteCycliste Posts: 10member
    He may be right. Dashboards may end up like computer monitors of old, a blank slate for whatever OS a driver favors. Nothing to stop auto makers from providing a stock UI, but with a standardized interconnect module, Apple and Android fans can have a seamless experience. 
    How about this, Rivian?
  • Reply 5 of 32
    riverkoriverko Posts: 148member
    Well. It was VW Group who thougt EVs are just a hype and they don’t have to care for it. Then they tried to jump to the fast going train… so will see how good this prediction is…
    lolliver
  • Reply 6 of 32
    Then they tried to jump to the fast going train”
    These times have been quite successful so far after some initial hassles. 
    Obviously, they solved a lot of puzzles that Tim Cook hasn’t even identified (if he ever will) despite trillions and trillions spent in the effort.
    edited June 22 lkrupp
  • Reply 7 of 32
    StrangeDaysStrangeDays Posts: 12,063member
    Roderikus said:
    “Then they tried to jump to the fast going train”
    These times have been quite successful so far after some initial hassles. 
    Obviously, they solved a lot of puzzles that Tim Cook hasn’t even identified (if he ever will) despite trillions and trillions spent in the effort.
    Apple has spent trillions & trillion on their auto efforts, whatever they may be? Source?
    Beatsdarkvaderlolliver
  • Reply 8 of 32
    retrogustoretrogusto Posts: 949member
    DAalseth said:
    I’ve thought the same for a while now. It’s one thing to produce a system that is used in other people’s cars, and making the whole thing yourself. The latter involves setting up a dealer network, service and support systems, dealing with warranty claims and more. The current network of AppleStores would simply not work at all for this. Apple would have to build a new car dealership network from scratch. Apple has experience designing software. It’s another story with seats, air bag systems, wheel bearings, door locks, and all the rest of the stuff that goes into a car. 
    Why reinvent the wheel, when they can make something to go on other people’s products. Far less hassle and far more money to be made in the latter. 
    If Apple were to sell their own car, it wouldn’t surprise me too much if they invented their own model for sales and support. They do have a history of doing things differently, as we’ve seen with their stores, their credit card, etc. And Tesla seems to have already paved the way with some innovations in the way cars are sold. Also, a lot of car parts are designed and built by third parties, including the examples you mentioned like seats, air bag systems, bearings and door locks. This recent Economist article claims that 70% of Mercedes Benz cars are third-party parts, and for Stellantis (Fiat/Chrysler/PSA etc.) it’s 85%.

    I also don’t think Apple would do their own manufacturing, given how they currently operate. But I agree that they might prefer to just stick to the high-margin software side of things. 

    Odd that Herbert Diess would seem to think that Apple’s valuation was the source of their “virtually unlimited access to resources.” Apple has a ton of cash, a very reliable revenue stream with excellent margins, and one of the most respected brands in the world, so they have billions to spend, with more coming in every day, and can borrow billions more at a very good rate anytime they like. The valuation would only make a difference if they were to issue new shares to raise money, but they’ve been doing the opposite (buybacks) for years. 
    lolliverJWSC
  • Reply 9 of 32
    1348513485 Posts: 228member
    DAalseth said:
    Apple has experience designing software. It’s another story with seats, air bag systems, wheel bearings, door locks, and all the rest of the stuff that goes into a car. 
    Why reinvent the wheel, when they can make something to go on other people’s products. Far less hassle and far more money to be made in the latter. 
    Virtually all of Apple's software designs go into Apple hardware designs. CarPlay is an exception to this point. Even if CarPlay is offered on a vehicle, for which Apple gets a small fee, all the auto makers also have their own software which comes on every vehicle by default. CarPlay is OK but not necessary, so the profit isn't going to knock your socks off.

    When it comes to profit, Ford, for instance, makes $10-14,000 on each F150 they sell, sometimes much more if the customer loads up on options. It's extremely likely an Apple car isn't going to be an econobox, so they will profit handsomely, you can be sure. Then there's the service aspect, which you may not know is where car dealerships make the most money per vehicle. An Apple car will primarily be comprised of modular components, which will be replaced, not likely repaired.

    There may be plenty of reasons for Apple not to build cars, but making money isn't going to be one of them.
    lolliverJWSC
  • Reply 10 of 32
    barthrhbarthrh Posts: 118member
    I believe that with EV platforms that cars will become more of a customization / personalization experience. Today, most manufacturers design and build most of their cars and electronics. Some may buy an engine from another manufacturer (e.g. Toyota engines in Lotus) or work together on one car (BMW Z4 / Toyota Supra). I expect that with an EV all but the largest manufacturers will buy a platform: batteries, motors, drivetrain. They'll mess with suspension, body, interior. Purchase the electronics. This is great news to companies that make (today) unreliable cars (fill in your favorite British or Italian brand here). Apple's plan in this could be to provide components. Software via CarPlay, self-driving, maybe even offer the battery / chassis / tech as a ready-to-build-upon stack.

    JWSCretrogusto
  • Reply 11 of 32
    bloggerblogbloggerblog Posts: 2,218member
    I feel the Titan project was Ive's dream project, photographed with Bono in a Fiat Jolly. If Apple wants to hit the ground running on shipping cars, they'll have to buy a car manufacturer. We saw with Tesla, Rivian, Ford, Mini, VW how long that process takes. I'm not sure what Apple can bring to the table here except integrating their the infotainment with their ecosystem. This would be a high risk project with questionable returns
    nubus
  • Reply 12 of 32
    DAalseth said:
    I’ve thought the same for a while now. It’s one thing to produce a system that is used in other people’s cars, and making the whole thing yourself. The latter involves setting up a dealer network, service and support systems, dealing with warranty claims and more. 
    Why reinvent the wheel, when they can make something to go on other people’s products. Far less hassle and far more money to be made in the latter. 
    I agree. Apple famously is not the first to enter markets — think MP3 players, smartphones, wearable tech. But when they do, they tend to do it better than the others, redefining those markets as Apple's entries mature. And Apple also prefers to dominate the product categories in which they compete.

    Is there enough that needs to be redefined in the automotive market? Even if there is, how could Apple possibly dominate a product category like that? Apple can afford to attempt to compete in certain product categories (e.g. WiFi access points, expensive smart home speakers) and then to simply walk away from those products when market conditions change. It was not embarrassing for Apple to discontinue their AirPort routers or the full-size HomePod speaker — disappointing to some customers, yes, but not to investors or shareholders.

    But the incredibly high startup costs of building a new car company? And the ridicule they would get if they started making cars but then had to discontinue them in, say, five or even 10 years? I don't see Apple wanting to do that.

    I will certainly be happy, though, if Apple finds a way to get some of the mainstream automakers to partner with them to improve the entire in-car experience (the software, the controls) and/or even help the automotive industry advance its efforts toward safety and autonomous driving.
    darkvaderdewme
  • Reply 13 of 32
    paxmanpaxman Posts: 4,705member
    Perhaps a replay of the Motorola / iPhone situation. Apple first created the software and then when the hardware fell short they created that, too. This is obviously orders of magnitude more advanced and complex, but if Apple partners with car manufacturers and creates the brain and UI, they could eventually buy one of their partners out and take it from there. But there are many good car manufacturers out there, why would you want to buy an Apple built hunk of metal? 
  • Reply 14 of 32
    Cesar Battistini MazieroCesar Battistini Maziero Posts: 253unconfirmed, member
    Too bad! I really like Volkswagen cars,
    But when this tech is available, I will want it, and I will go for whatever brand has it.

    They took the longest out off all automakers to support CarPlay in Brazil, they added wireless CarPlay this year.

    I will buy a new car in 3 years, whatever brand has full CarPlay support will get my money.
    lolliver
  • Reply 15 of 32
    BeatsBeats Posts: 3,010member
    DAalseth said:
    I’ve thought the same for a while now. It’s one thing to produce a system that is used in other people’s cars, and making the whole thing yourself. The latter involves setting up a dealer network, service and support systems, dealing with warranty claims and more. The current network of AppleStores would simply not work at all for this. Apple would have to build a new car dealership network from scratch. Apple has experience designing software. It’s another story with seats, air bag systems, wheel bearings, door locks, and all the rest of the stuff that goes into a car. 
    Why reinvent the wheel, when they can make something to go on other people’s products. Far less hassle and far more money to be made in the latter. 

    Imagine if Henry Ford and other manufacturers thought this way…. We would all be riding horses.

    Apple spending years and billions to supply an extension of iPhone only is NOT a good idea. At some point they would need hardware.
    lolliver
  • Reply 16 of 32
    JinTechJinTech Posts: 872member
    Did anyone watch The Talk Show hosted by John Gruber with Craig Federighi and Greg Joswiak as guests? There is a part where Gruber is like "certainly Apple has never thought about developing a car now" and Federighi just kinda smirks. It seemed pretty obvious without saying anything, that Apple is indeed developing a car. I'll look for the specific clip when I get home but it was rather telling.
  • Reply 17 of 32
    charlesncharlesn Posts: 277member
    Remember the Apple television? Same. 

    Car makers are good at building cars--terrible at designing and implementing the systems and GUI to run them. I think there's much more profit in Apple selling automakers what Apple is best at doing than there is in Apple manufacturing the whole car. We shall see. 

    My recent first experience driving a Tesla was most impressive--the voice recognition system worked astonishingly well across almost all systems. No need to get the commands just right--it always understood what I wanted and responded accordingly. And it doesn't get much better or easier than simply telling your car what you want it to do. 


    JWSC
  • Reply 18 of 32
    programmerprogrammer Posts: 3,420member
    Beats said:
    DAalseth said:
    I’ve thought the same for a while now. It’s one thing to produce a system that is used in other people’s cars, and making the whole thing yourself. The latter involves setting up a dealer network, service and support systems, dealing with warranty claims and more. The current network of AppleStores would simply not work at all for this. Apple would have to build a new car dealership network from scratch. Apple has experience designing software. It’s another story with seats, air bag systems, wheel bearings, door locks, and all the rest of the stuff that goes into a car. 
    Why reinvent the wheel, when they can make something to go on other people’s products. Far less hassle and far more money to be made in the latter. 

    Imagine if Henry Ford and other manufacturers thought this way…. We would all be riding horses.

    Apple spending years and billions to supply an extension of iPhone only is NOT a good idea. At some point they would need hardware.
    The world is an extremely different place now, and the automotive industry completely different.  Frankly I think Apple would be beyond stupid to start building cars.  IMO, it makes way more sense for them to build the computers that go into cars (and the software for them).  Then sell this to any car maker that wants it.

    darkvader
  • Reply 19 of 32
    robin huberrobin huber Posts: 3,603member
    Then there's the service aspect, which you may not know is where car dealerships make the most money per vehicle.
    I’m curious as to how much less income EVs bring in for service than ICEs. Had a Chevy Bolt for a year now with no regular service necessary. Only time it’s been to the dealer was to update charging software at the dealer’s expense. With no ICE with its attendant mechanical devices (cooling system, transmission, exhaust, differential, etc.) there are far fewer things to go wrong. Electric motors are devilishly simple devices with basically one moving part! About the only things that need changing are brake fluid, tires, and cabin air filter, and those are very infrequent. With regenerative braking (one pedal driving) I rarely touch my brakes. Unless there’s something I’m missing dealers are going to take a big hit. 
    edited June 22 JWSCretrogustotht
  • Reply 20 of 32
    darkvaderdarkvader Posts: 841member
    Apple isn't going to build a car. 

    First, Apple doesn't actually build ANYTHING.  Every bit of hardware with an Apple logo on it is actually made by somebody else.

    Second, the manufacturing companies that actually build Apple stuff aren't car manufacturers, they're computer part manufacturers.  If they were going to build cars, they'd first have to build car factories.  And that would get noticed.

    Apple is playing with self-driving technology.  Apple isn't doing it much, and isn't doing it very well.  They're WAY behind Google and the actual car companies.

    The most you're going to see out of Apple for at least a decade is CarPlay.  And for Apple to have a car as a shipping product even in a decade they'd either have to buy or partner with an actual car company.
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