By In a significant shift, Apple is reportedly halting its ambitious project to develop an electric vehicle (EV), a venture that began in 2014, as the demand for EVs wanes.
Bloomberg reported that despite investing billions, Apple is now winding down its EV efforts, citing sources familiar with the matter who wished to remain anonymous due to the sensitivity of the information.
This move comes as a surprise, given the tech giant’s extensive investment in the electric vehicle market over the past decade. However, a slowdown in EV demand and doubts about the profitability of the project, even with a steep $100,000 price tag, have led to this strategic withdrawal.
Apple’s Chief Operating Officer Jeff Williams and Vice President of Technology Kevin Lynch, who were leading the EV project, broke the news to the project’s approximately 2,000 team members. The announcement marks a significant redirection of resources, with many of these employees now set to focus on artificial intelligence developments for Apple. Unfortunately, this shift will also result in some layoffs.
Originally, Apple’s vision for the EV included a driverless car with a limousine-like interior, aimed at the high-end market with a pricing around $100,000. Yet, the company harbored concerns about whether such a vehicle could achieve the high-profit margins typically expected of Apple products.
American car manufacturers are currently grappling with the challenge of inexpensive Chinese EVs entering the market, which has caused significant losses for companies like General Motors and Ford. In 2023 alone, Ford reported a loss of $4.7 billion, pointing to intense price competition in the EV sector.
Stellantis CEO Carlos Tavares recently highlighted the competitive threat posed by these Chinese EVs in a Bloomberg interview. He noted that while these vehicles could be priced competitively with traditional internal combustion engine vehicles, Western carmakers struggling to produce cost-effective EVs could face existential threats, especially under government mandates for 100% EV sales.
President Biden’s administration has been a strong proponent of electric vehicles and charging infrastructure, committing billions of taxpayer dollars to these initiatives. The administration’s goal is for EVs to make up half of all new car sales by 2030, a target that now seems increasingly ambitious given the current market trends and challenges faced by industry leaders like Apple.
At the time of reporting, Apple had not provided an official comment on the matter to the Daily Caller News Foundation.
