Has Apple already lost the market for self-driving cars? originally appeared on Quora: The best answer to any question.
Answer by Jason Lancaster, editor of AccurateAutoAdvice.com, on Quora:
Perhaps.
On one hand, Stan Hanks, Mike Barnard, and Paul Reiber all explain why the market for self-driving vehicles is still a ways away. It's hard to "lose" a market that doesn't yet exist.
However, this isn't just a question about self-driving cars. It's also a question about starting a car company. For that reason, I'd argue Apple is very much up against the wall.
First of all, automotive manufacturing is hard. Building iPhones and iPads is one thing; building a vehicle that's expected to be essentially flawless despite potholes, torrential rainstorms, freezing cold and desert heat, and complex engineering challenges is quite another.
I'd posit that manufacturing a car is actually much more difficult than manufacturing a smartphone, and that it takes years of effort for an automaker to make vehicles of decent quality and reliability. Tesla, for example, has built a very nice product in the Model S, but they've also had well-documented reliability issues...and they've been building cars since 2007 or so.
If Apple wants to sell reliable, autonomous cars in 2025, they need to begin manufacturing cars as soon as possible so they can gain some experience. I'd say they'll need 3-5 years of manufacturing experience (at a minimum) to "learn" enough to build a good quality car. That's far less time than companies like Toyota and Hyundai needed to reach an acceptable quality level, which means this could be very ambitious.
Second, engineering and manufacturing takes years to spool up. If Apple decided to built their own car 18 months ago, they're at least 18 months away from having a vehicle that's ready for production. That's because designing, prototyping, and testing a new vehicle platform takes years.
Not to mention, even if Apple had a car to show off at the NY Auto Show in 2017, they'd need 12-18 months to get a manufacturing plant up and running. Combine the 2-3 year time to market with the 3-5 years of experience they need to learn to build good cars, and we're looking at 2025 or so before they're ready to build a great car people would want to buy.
Third, Apple may have peaked. Call me a hater, but what reason is there to assume Apple's reputation is going to stay where it is? The watch was a flop, and their only consistent source of success is the iPhone, as the market for Macs and iPads is drying up (as it is for all computer hardware companies).
While the iPhone is a powerhouse, it seems like a difficult product to build a company around. The phone market moves fast, the public is fickle, and Apple has dodged a number of bullets already (anger over manufacturing conditions, anger over avoiding taxes, anger over privacy and security policies, anger over a terrible maps product, bending issues, etc.).
To be clear, I'm not saying Apple is doomed to fail. I'm merely pointing out that Apple seems to be riding about as high as a company can possibly ride. The only way is down. If or when Apple brings a car to market, the public might not want them.
Summing Up
- Building cars is hard. It takes time to become good at it.
- Designing and building a car from scratch takes years.
- Apple's appeal as an automaker is very much steeped in their success as a computer hardware manufacturer. If something happens to sully their reputation, their entry into the crowded automotive market could be their Waterloo.
Personally, I do not understand why Apple would want to bother with building cars. Most automakers lose money about as often as they make it (at least recently), the regulatory environment and incredible liability sucks, and the competition is stiff. Apple would be better off focusing on developing personal devices, like a smartwatch that someone might actually want to wear, VR headsets, "wearable" batteries and devices, etc. etc.
But regardless of "why" Apple wants to build cars, they need to get moving. If they don't have something to show the world soon, they're going to be far behind the auto industry when it comes to autonomous vehicles (at least in terms of offering a product that's highly rated and known to be reliable).
. . .
Answer by Stan Hanks, investor, entrepreneur, and car guy:
OK, we're not talking lost lost here, not like the Apollo 13 guys [lost the moon].
We're talking about a market that really doesn't exist yet. And it's not possible to know who the winners will be, because we don't even know who the players are going to be, nor what the ground rules will be.
Think about it. In 2015, we've had, what, 130 years of development since the Benz Patent Motor Car in 1885? And how many players are in the market now that have ever been in the market? (Hint: fractionally small number, and more die every year than are started).
Here's what I know about some of the players:
1) Google is the king of machine learning, and of stealth operations to aggregate enough data into the machine learning "machine" to make it useful. I highly suspect that Street Maps has been an elaborate ruse to feed the ML engine all along. We don't know what else they're up to, nor what else was actually mapped by the Street Maps team.
2) Autonomous vehicle work has been funded by DARPA since the mid-80s. There's a ton of info available from those programs, and has anyone tracked where the students and faculty involved in those programs went? I haven't. That would be interesting data.
3) Given the DARPA interest, it's worth mentioning that we also don't know anything about the non-publicly-funded projects in autonomous vehicles that have been going on inside military contractors "encouraged" by their sponsors for yet-to-be-released bids. And we know even less about what's going on in other countries.
4) Apple is the king of the ecosystem model of marketing. That, and truly superior user experience (mostly. looking at you, Apple Watch). Apple already has Car Play products shipping from a variety of non-Apple manufacturers. Given that Car Play is a huge deal for users of the Apple ecosystem, consider this: if completely seamless integration is so important to Apple, why the hell would they do that instead of manufacturing and selling their own units?
5) It's been clear for a long time that Apple product users will pay a premium for participation in the ecosystem. The number of car manufacturers who have pledged to have Car Play integration is effectively "every one that matters." If they don't have it, people will buy the cars they would have otherwise bought from Manufacturer A from Manufacturer B, who does have it.
6) Apple is not, and has never been, a technology leader. They're a user experience leader, delivering mid-market technology wrapped in a user experience that makes it possible for them to crush competitors who deliver technologically superior solutions. Consistently. For a really long time.
My thesis: Apple is working on something, but it will seriously lag Google (and possibly Tesla, and others).
Apple will not have aspirations to manufacture their own line of cars, or if they do it will be ultra-high-end low-volume, the space above Tesla Model S.
Apple will have some take on the UI for self-driving cars that no one has yet imagined, and they'll provide hooks for that under license to everyone who actually makes cars.
And it may in fact wind up being the dominant life form.
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