The market is too bullish on Apple (AAPL) – Get Report and some suppliers following last week’s report that the tech giant is working on a self-driving car, according to TFI analyst Ming-Chi Kuo.
The earliest Apple will be able to bring a vehicle to market is 2025, according to Kuo, who is a closely watched Apple analyst, though he thinks it is more likely that a vehicle wouldn’t make its debut until 2028 or later. A report last week from Reuters said that Apple is planning to release its own autonomous car in 2024.
“If Apple car wants to succeed in the future, the key success factor is big data/AI, not hardware,” Kuo said in the note, according to Seeking Alpha. “One of our biggest concerns about Apple car is that when Apple car is launched, the current self-driving car brands will have accumulated at least five years of big data and be conducive to deep learning/AI. How does Apple, a latecomer, overcome this lagging gap?”
Kuo also said that the rally in shares for autonomous vehicle parts suppliers following last week’s report is “only speculations by the market and do not involve actual Apple car suppliers.”
The Reuters article provided an update on Apple’s “Project Titan,” which has been developing a vehicle in fits and starts since 2014. According to the news report, Apple is focusing on a new design which sources said could “radically” reduce the cost of batteries and increase the vehicle’s range, according to a person who has seen Apple’s battery design.
But pandemic-related delays could push back the start of production to 2025 or later, the report states.
Apple shares were rising 3.2% to $136.16 in trading Monday.
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