Could Apple’s shares rise further as a result of electric vehicles?

Could Apple's shares rise further as a result of electric vehicles?

Apple’s stock hit a new high on Friday,  the corporation had set an internal goal of 2025 for the delivery of an autonomous car. Apple’s foray into electric and driverless vehicles has been rumoured for some time, and the corporation is reported to be working on them through an internal project called “Titan.”

This year has seen a number of challenges for Apple (AAPL), including a global processor shortage that cost the company $6 billion in missed sales in the fiscal fourth quarter. The stock, on the other hand, has renewed traction and just achieved a new all-time high, recovering its status as the world’s largest firm by market capitalization.

A Tesla killer?

Meanwhile, some of the analysts are bullish on Apple’s entry into EVs and see it as a clear risk for Tesla, whose market cap recently crossed above $1 trillion. Loup Ventures’ co-founder Gene Munster sees Apple’s entry into electric vehicles as the biggest risk for Tesla. If the company bets big on electric vehicles, it can be a tough competitor to not only legacy automakers but pure-play electric vehicle makers like Tesla, Rivian, Lucid Motors, and NIO. The iPhone maker has the financial strength and technical expertise to become a major competitor in the electric vehicle industry.

EV market opportunity

Foray into electric vehicles could be a long-term driver for Apple stock. Morgan Stanley analyst Katie Huberty sees it as a big opportunity for the company. “Smartphones are a $500bn annual TAM. Apple has about one-third of this market. The mobility market is $10 trillion. So Apple would only need a 2% stock of this market to be the size of their iPhone business,” she wrote in a client note.

After the recent reports of Apple’s entry into autonomous cars, she has reiterated her bullish views. She said, “We can provide a number of examples from the last 20 years that show while Apple may not always be first to market, its innovation engine, differentiation via vertical integration, and manufacturing/operational excellence have allowed it to leapfrog first movers.”

Apple’s entry is a risk for incumbents

Meanwhile, AAPL’s entry into electric cars is a risk not only for Tesla but other EV names also. Morgan Stanley analyst Adam Jonas who is a noted Tesla bull termed Apple’s entry into EVs as an “ultimate EV bear case” and a “clear negative for much of our automobile coverage.” Notably, while Jonas is bullish on Tesla, he holds a bearish view of Lucid Motors which is run by a former Tesla employee Peter Rawlinson. Tesla’s CEO Elon Musk has also mocked the soaring valuations of Lucid Motors and Rivian. The latter is backed by Amazon, whose chairman Jeff Bezos does not share a friendly relationship with Musk. What do we know about Apple’s electric car?

We don’t know much about Apple’s electric and autonomous cars but the company might opt for a third-party tie-up for production, as it does with the iPhone and the Macs. Last year, citing sources, a Reuters report said that Apple is working to “radically” lower the battery costs and increase the range. The source called Apple’s battery technology the “next level” and compared it with “the first time you saw the iPhone.” Batteries are a key component of electric cars. It not only impacts a car price but also determines its range that is very important while choosing an electric car. Production plans

Here it is worth noting that companies like Tesla, Rivian, and Lucid Motors have built their own plants for producing cars. However, many others like Fisker and NIO have opted for a third-party tie-up. Now, there are pros and cons of both the strategy. While a self-owned plant gives control over the production process, it also exposes the company to higher execution risk.

The News Highlights

  • Could Apple’s shares rise further as a result of electric vehicles?
  • Check the latest Rumors updates and news.
Disclaimer: If you need to edit or update this news from compsmag then kindly contact us Learn more

For Latest News Follow us on Google News


Latest Headlines
  • Show all
  • Trending News
  • Popular By week
Food technology startup drop-in sugar substitute debut
Food technology startup drop-in sugar substitute debut
The spray-dried composition is the result of a three-year R&D campaign of mixing and matching different fibers, natural sweeteners and botanicals, said ...
Two DeFi Hacks Achieve $120 Million and $500 Million Algo Fund Features
Two DeFi Hacks Achieve $120 Million and $500 Million Algo Fund Features
Announced via a blog post by the Algorand Foundation, the capital will specifically focus on decentralized applications, niche services of liquidity mining, ...
Brazil’s highest court opens investigation into President Bolsonaro’s false claim that Covid vaccination increases the risk of AIDS
Brazil’s highest court opens investigation into President Bolsonaro’s false claim that Covid vaccination increases the risk of AIDS
Brazil registered 221 Covid-19 related deaths on Friday, according to the Ministry of Health. The country has recorded 615,400 Covid deaths since the start of ...
Break Arts II, a mecha racing game, is now available on PlayStation 4
Break Arts II, a mecha racing game, is now available on PlayStation 4
Players can also carry weapons and traps, which they can employ to hurt and slow down other players. They can also use the Override mechanism to make their ...
A Guide to Starting a Small  News in 2022
A Guide to Starting a Small News in 2022
It is important to take time to do some research on what starting a business involves. The following are a few tools and resources you can use to educate ...
The “Ransomware Mitigation Kit” brings together AWS, CrowdStrike and Presidio.
The “Ransomware Mitigation Kit” brings together AWS, CrowdStrike and Presidio.
A Ransomware Mitigation Kit Is Being Developed To Protect The Corporate Sector According to reports, CloudEndure, an Amazon Web Services cloud computing ...
Can common cold viruses protect against COVID-19?
Can common cold viruses protect against COVID-19?
The researchers analyzed serum samples from 825 participants taken before the pandemic, and assessed their immune responses to four of these HCoVs. When an ...
More people can install Android TV apps using their smartphones
More people can install Android TV apps using their smartphones
Now it is available for more users worldwide. Email ArticlePrint Article 📣 The Hans India is now on Telegram. Click here to join our channel (@thehansindia) ...
Important things to keep in mind when planning to buy first iPhone
Important things to keep in mind when planning to buy first iPhone
But you’ve made up your mind: you’re going to get your hands on the world’s most popular smartphone. But which one should you pick? Unlike in the past, Apple ...
Crypto community reacts to Charlie Munger yelling at Bitcoin again
Bitcoin looks stable, but funding is still flowing; Hashed Raises $200 Million for Web3 Adoption
Judging by the last bit of this next tweet (below) Van de Poppe also now believes the market’s overall bullish trend has moved into a “lengthening cycle”, as ...
Show next
We will be happy to hear your thoughts

      Leave a reply

      Compsmag - Latest News In Tech and Business
      Logo