Piper Jaffray sees 'Apple Car' as longterm project with potential short-term effect on stock
Investment firm Piper Jaffray doesn't expect a mythical "Apple Car" to be on the roads anytime soon, but the firm did advise its clients this week that the rumored project will affect shares of AAPL as investor expectations adjust.
Artist's (poor) rendering of an Apple garage.
"We believe a car from Apple is further away than some people think (closer to 10 years away than 5 years), but the car theme will impact AAPL's multiple as investors increasingly view the opportunity as a long-term growth driver," analyst Gene Munster wrote in a research note provided to AppleInsider.
Munster isn't entirely sold on the idea of Apple bringing a car to market, though he does believe the company is experimenting with one internally. If Apple were to release such a product, the analyst would expect it to focus on the luxury market of $50,000-and-up, with three core features: design, connectedness, and automation.
In his view, an "Apple Car" would likely be entirely electric, citing the company's commitment to the environment, as well as its vision to deliver future technologies earlier than other companies.
He sees particularly strong potential for an Apple-built vehicle in the U.S., where automotive ownership is saturated at nearly one car per person. To him, this highlights a "vast inefficiency" in car ownership that could make a self-driving vehicle especially appealing to consumers who want to consolidate vehicles.
"The majority of these vehicles sit idle at any given time," Munster wrote. "Autonomous vehicles should significantly help this inefficiency by allowing families to own fewer cars over the long-term by using a single vehicle."
Munster is perhaps best-known amongst Apple watchers as a longtime proponent of another rumored product that never made it to market -- an Apple television set. The analyst finally abandoned those hopes in May, after reports said that Apple had internally abandoned its plans to sell a full-fledged HDTV.
Munster cited his own, squashed dreams for an Apple television in this week's note to investors.
"As we recently learned with the television, just because Apple is working on a project does not mean it will become a reality," he said. "Although the car market is much more significant than the TV market in terms of not only revenue, but societal importance, and likely more poised for meaningful disruption."
Piper Jaffray remains one of the most bullish firms regarding Apple stock, with a price target of $172 and "overweight" rating.
Artist's (poor) rendering of an Apple garage.
"We believe a car from Apple is further away than some people think (closer to 10 years away than 5 years), but the car theme will impact AAPL's multiple as investors increasingly view the opportunity as a long-term growth driver," analyst Gene Munster wrote in a research note provided to AppleInsider.
Munster isn't entirely sold on the idea of Apple bringing a car to market, though he does believe the company is experimenting with one internally. If Apple were to release such a product, the analyst would expect it to focus on the luxury market of $50,000-and-up, with three core features: design, connectedness, and automation.
In his view, an "Apple Car" would likely be entirely electric, citing the company's commitment to the environment, as well as its vision to deliver future technologies earlier than other companies.
He sees particularly strong potential for an Apple-built vehicle in the U.S., where automotive ownership is saturated at nearly one car per person. To him, this highlights a "vast inefficiency" in car ownership that could make a self-driving vehicle especially appealing to consumers who want to consolidate vehicles.
"The majority of these vehicles sit idle at any given time," Munster wrote. "Autonomous vehicles should significantly help this inefficiency by allowing families to own fewer cars over the long-term by using a single vehicle."
Munster is perhaps best-known amongst Apple watchers as a longtime proponent of another rumored product that never made it to market -- an Apple television set. The analyst finally abandoned those hopes in May, after reports said that Apple had internally abandoned its plans to sell a full-fledged HDTV.
Munster cited his own, squashed dreams for an Apple television in this week's note to investors.
"As we recently learned with the television, just because Apple is working on a project does not mean it will become a reality," he said. "Although the car market is much more significant than the TV market in terms of not only revenue, but societal importance, and likely more poised for meaningful disruption."
Piper Jaffray remains one of the most bullish firms regarding Apple stock, with a price target of $172 and "overweight" rating.
Comments
..it's a Marc Newson design from quite a few years back
That's the silliest looking rendering of what the car would look like. Why would an electric car have a radiator grill in front? They need to get an artist who understands what they're trying to draw.
That's just the Marc Newson-designed car, the Ford 021C he did back in 1999. So whomever created that image just pasted it in, floating above the floor nevertheless.
Car sharing is going to become quite popular. I'm a little surprised I haven't heard of a tech company doing this. I did see a car sharing thingy based on airport parking, but can't remember the name. Rather than pay to park your car at an airport, you rent it out.
I can see neighbors pooling resources to share a co-owned car.
Gene, Gene, Gene ... You're really falling down on the job -- The [B][I] New Apple Car [/I][/B] will come with a [B][I][COLOR=blue] New Apple TV Set![/COLOR][/I][/B]
Groan... Munster is on this case?
Hope it's not a case of TVbyApple redux.
That's the silliest looking rendering of what the car would look like. Why would an electric car have a radiator grill in front? They need to get an artist who understands what they're trying to draw.
Hehe, I have to agree.
That's the silliest looking rendering of what the car would look like. Why would an electric car have a radiator grill in front? They need to get an artist who understands what they're trying to draw.
Agreed. I've got cheap plastic toys littering the basement from my kids' kids days that look more aesthetic than that....
For the same reason that people think the Apple Watch should be round. It's what people expect a car to look like and any deviations will make them uncomfortable!
We will see an TV set with an AppleTV build into it in the next 18 months.
Then Gene will be hailed as an analyst with great foresight who was just a few years too early!
Absolutely. It's a self-driving TV with a huge panel to enjoy the 16k content that will be standard by the time it arrives.
Not at all practical to have a car to show off by next year. I would be surprised to see a few actual prototypes by 2018 as they would have to narrow down the most practical designs that they feel the public would have a positive reaction to.
Most new cars that aren't already a model line take on average 3 years before they narrow down the protoypes and another 2-3 years to build and test the cars before they would see a public announcement of when the car would go on sale.