I’m always afraid to comment on consumer based technologies because, in 63 years, I’m going to look back and think: “Did I really not believe that the PS9 will not have nanotech going up your nose?” (See the PS2 commercial: https://www.youtube.com/watch?v=GgcyKwsG91M)
All joking aside though, I find it difficult that Apple will create a car no matter how prevalent its technology will be in the newest luxury car. While Google has already proven the benefits of spending a lot of money on everything will do, technology companies will not enter the automotive market without an established partner.
Tesla has already shocked with the world with creating a cool, desirable, and fast car that is, strangely, incredibly safe (Seriously, it’s because the front hood is also a trunk rather than everything like other cars). But Tesla took a concept that was already well on its way of being accepted by the average consumer: creating cars that use alternative fuels. In addition, Elon Musk, from day 1, understood the importance of the supply chain. When he created SpaceX, he went to Russia personally to see if he could use rockets that the Soviet Union had built, and only after decided to start the design from the ground up. Even the great visionary thought it would be silly to not use the existing technology and supply chains unless it didn’t achieve his goals.
Google, despite its self-drive technology working, does not have a supply chain in place to produce cars, much less the relationships to distribute said cars. Apple, who is trying things out, is even further behind. This is certainly not to say that it will never happen; both Google and Apple are sitting on an unbelievable amount of money, and they have shown a willingness to invest in technology that is either adjacent to their own offerings or just plain cool to someone who has a say on the purse. But that’s the thing: both companies excel in creating products and services that wasn’t there before: search, music devices, tablets, etc. Admittedly, they’re never the first to come out with the technology, but they are the first to create a very successful version of the new idea (who remembers the Windows tablet from 2000?).
No doubt Google and Apple will be part of the new car someday. For example, look at what happened to our GPS systems. Even if the phone isn’t connected to the car save for a charging cord, more and more people rely on Google Maps rather than the GPS built in the car (or, I suppose, lack there of). But these technology giants won’t be able to revolutionize everything about the car, like the tires or the chassis, without spending an inordinate amount of time and money, which by then the shareholders and employees will be screaming for management’s heads.
At the end of each of these articles, I like to ask if there’s a way to capitalize on this through investing. I’m rather boring when it comes to it; I only long stocks. Any other method, and I would have to spend more time than it’s worth. In this case, there’s nothing to do on the investing side. But it is something to look out for. If either company makes a huge push to enter the automotive market, it might be a good time to stay on the sidelines and see what happens.
Disclaimer: I don’t have any interest in Google or Apple. Mainly because I don’t have enough money to invest in Google, and I have no idea where Apple’s going to be in the next year.