Transcript & Summary: The Apple Car - A $10 Billion Failure

[00:00] this video is brought to you by incog hi welcome to another episode of Cold Fusion it was the fall of 2015 and Johnny I chief designer at Apple could not hold back his excitement he wants to show Apple CEO Tim Cook a concept that he'd been working on IV ushers Tim Cook towards a minivan and instructs him to siten it it was no ordinary minivan though there's no steering wheel and the car is fully autonomous the interior looks f fistic with wood and leather upholstery John asked Tim Cook to speak a command to Siri who was in fact a [00:37] human voice actress standing a few feet away she was pretending to be the voice assistant Tim was supposed to use his imagination and fill in the blanks Johnny I have even asked this quote unquote Siri for information about a restaurant on the side of the road and the actress responded accordingly it sounds like a comedy sketch but according to the verge this was a real set of events at the perception of what would become the ill- fated Apple car with an initial demo like that one might think it's not a [01:06] surprise that 10 billion later the project failed but is this too cynical of a take surely Apple must have seen something to want to jump into the automotive business in this episode we'll take a look at why Apple even decided to make a car why they invested billions into the project and how it eventually ended up failing so fasten your seat belts as we go on a ride to find out why the Apple car never made it to the Finish Line you are watching T Fusion [Music] [01:43] TV Apple appears to be unplugging its plans to build electric cars according to a Bloomberg report uh their report says the tech giant is winding down its EV team called the special projects Group which employs thousands of workers a Bloomberg says the team struggled to fit even plans in with Apple's Core Business of electronics and online services and questions remain regarding where Apple would manufacture the vehicles the report says the move signals the end of Apple's secretive effort to rival EV Juggernaut Tesla [02:15] before we start let's get one thing out of the way Apple has never formally acknowledged the existence of a car project and as such they haven't announced its cancellation but despite this there were clear signs that the company was venturing into the automotive industry if if you can believe it from the year 2000 to 2022 Apple has applied for 248 car related patents making it their second largest category after communication and navigation throughout the years they've also hired a bunch of Automotive [02:44] Engineers to work in a top secret lab in Silicon Valley but perhaps the most obvious evidence comes from the California Department of Motor Vehicles where Apple has registered drivers and vehicles for testing it was serious business and Elon Musk even offered to sell Tesla to Apple in 2017 and this was during the production hell of the model 3 but Tim Cook gave musk the cold shoulder so it's clear that apple had some car related projects that they've been working on for some years now but some of you might be thinking Steve Jobs [03:14] wouldn't have tolerated such Tom Foolery but you'd be wrong according to a Bloomberg interview Tony Fidel who oversaw the iPod project spoke with Steve Jobs a few times about Apple making a car and jobs entertained the idea quote we had a couple of walks and this was in 2008 about if we were to build a car what would we build what would a dashboard be what would seats be how would you fuel or power it what can apple do for the car market if you think about a car what's a car a car has batteries it has a computer it has a [03:47] motor and it has mechanical structure if you look at an iPhone it has all the same things if it has a motor in it so if you try to say and scale it up and go oh my God I could make a car with those same components there's some truth to that even though it's clear that this didn't make the top of job's list of priorities this interaction does indicate that Apple was thinking about making a car as far back as 16 years ago however it wasn't until 2015 that the first reports of Apple making a car actually caught steam we'll [04:18] get into that shortly but first it's important to understand why the mid-20s was such an interesting time for Apple to be stepping into the scene by then Tesla had laid the groundwork to prove that that EVS could be a viable product EV sales particularly in the United States were picking up and then newcomer rivan was already in the development phase so what was so compelling about the automotive space that Apple wanted to jump in I'd love to have a concrete answer but as far as I know outside of [04:46] Apple no one knows for sure but we can have some educated guesses Apple at this time was already one of the most valuable companies on Earth they had the cash to burn so it's possible that Apple wanted to revolutionize The Humble car and challenge the status quo but the automotive industry is over a 100 years old and EV companies were already doing much of the little Innovation to be had how much could a car really be reimagined at this stage there has to be a deeper reason the most logical reason [05:16] is that Apple simply wanted to play their usual game of tight software and Hardware integration Apple's carplay has existed since 2014 so integrating that into an Apple car could provide the tightest integration of all according to CNBC Apple has toyed with the idea of making payments from the car dashboard payments for fuel drive-through food and EV charging stations for example they go on to say that if the cars were fully autonomous it would free up trillions of collective transport hours per year for [05:45] people to use Apple apps in their cars and this would mean big revenue for Apple but the best insight into the motivations behind the move comes from Tim Cook in a 2017 interview he told the New York Times that Apple was focused on autonomous systems and that autonomous cars were essentially a robot he also said quote we love to integrate Hardware software and services and find the intersection points of those because we think that's where the magic occurs and so that's what we love to do and we love [06:15] to own the primary technology that's around that leaked sketches and reports pointed to autonomous driving no steering wheels passengers sitting across from each other a futuristic table in the middle and a perfect assistant obviously in the state that siries in this would have been a long way off anyway one of the first official stories to break out about the Apple car was from CBS in 2015 in it they tracked a self-driving Dodge Caravan in the Streets of San Francisco and they came to the conclusion that it was leased by [06:43] Apple that year there were numerous sightings of a similar car in New York too and you can see a few interesting comments in the YouTube comments section people 9 years ago were already alluding to an Apple car soon after reports indicate that Apple took plenty of steps to bring the Apple car AKA project Titan into reality according to the Wall Street Journal by February 2015 a large team of approximately a thousand people was led by ex Ford engineer Steve zesi Apple was also looking at Contracting manufacturers such as BMW [07:16] Mercedes nisson byd McLaren and Volkswagen but none of these efforts came to be but it seems like even before Apple could start the ignition there were issues under the hood [07:34] only a year into all the rumors and reports some shocking news broke zesi had already left by the end of 2016 Apple had fired at least a dozen employees and were second guessing the whole project zesi was replaced by Apple's former Hardware engineer Bob Mansfield who in turn hired a former Blackberry executive to focus on autonomous driving with such a lack of Direction and Leadership changes the employees involved in the project were already confused by 2018 both the workers and Leadership saw yet more [08:05] changes and by the end of the year The Washington Post reported that around 5,000 employees were directly or indirectly working on Project Titan and then Apple went crazy they ramped up testing in California and at one point they had more Vehicles registered than Uber and whmo combined and throughout this period Apple bought an autonomous driving startup drive.ai poached an electric motorcycle startup hired and then lost or fired multiple automotive executives from established companies like Tesla and they had employees [08:37] arrested for allegedly stealing and sharing trade secrets with China it was a wild ride but by 2022 the lack of Direction was becoming palpable Apple software Chief Craig federi harbored significant doubts about the project reports also suggest that the project was the butt of jokes by employees not directly involved in it and to make matters worse there was an incident earlier in 201 22 where an apple test vehicle came dangerously close to colliding with a jogger all seemed lost but then suddenly at the end of 2023 it [09:08] seemed like apple was finally getting their act together they decided to scale back their original Ambitions no more self-driving capabilities instead it's going to be a sub $100,000 standard car yeah it's basically a scaling back of what Apple planned to do they also rethinking what that product looks like sources are saying that they want to do something which is more lower level of autonomy think level two something more akin to Tesla's current capabilities with autopilot so as it turns out self-driving is really really hard with [09:42] nearly $10 billion spent the project had been scaled back but what finally killed it and why did it fail we'll find out after a quick word from today's sponsor so hopefully this doesn't happen in your car infotainment system but we've all had those scam phone calls text messages and fishing emails but have you ever wondered why it happens well the main reason is because your personal information is being sold online and you don't even know it from unsolicited scams and advertisements to your browsing habits or even identity theft [10:10] your sold information online can be used to achieve all of that and that's where today's sponsor incog can help they can delete your information from the records of data Brokers on your behalf simply just create an account then incog can contact the data Brokers you can just sit back and let them take care of the rest and they can even update you on their program press so to protect yourself online use the code cold fusion in the link below and get 60% of an annual incog plan go to incog docomo Fusion to get started thanks to incog [10:41] for supporting the channel okay so back to the episode from all we've learned it all begs the question why is it that after 10 years of constant back and forth Apple has finally killed the project one reason could be the departure of DJ navonne a hardware executive who left Apple to join rivan in January of 2024 reports suggest that he was one of the key drivers of the project and his departure could have been very detrimental another reason is that autonomous driving just proved too difficult but the reason most often [11:13] cited was that on February 27th 20124 there was an internal announcement at Apple there were stating that the project was cancelled but key to this staff will be moved into Apple's AI Department a lot of employees from Project Titan will be moved to quote support machine learning learning and other initiatives end quote it's clear that Apple has shifted its focus from the car to AI yeah they had ripped the bandaid off I mean it was clear this was putting good money after bad investors want to see them focused all in on AI so [11:44] I think this was something was been a painful period going through in terms of starts and stops on EV initiatives but I think the writing was the wall the smart move for cook and cerino focus all in on AI and I think it's a step forward and puts this chapter in the past if you've seen my video from a few weeks ago you'd know that apple is working hard behind the scenes to try and jump into the AI space they've been acquiring a staggering number of AI companies and they're just waiting for the perfect [12:12] time to strike in the context of the AI flood gates being opened by open AI pun intended it's clear that apple had to do something so with a lack of clear Direction and proper leadership it seemed like Apple's car project was destined to fail Apple was probably over ambitious from the start in 2015 achieving a fully autonomous vehicle is almost impossible to do and that goes for 2024 as well remember that conversation between Tony Fidel and Steve Jobs that I mentioned earlier in the video whenever they spoke about cars [12:44] Steve would entertain the idea but it said that this is what he would typically reply with quote at the end it was always like we're so busy we're so constrained it would be great if we could do it but we can't end quote and it seems like that's still the case for Apple with so many ongoing projects with so many advancements in so many areas Apple simply has their handsful in the past there were plans for a TV and a camera but they also never saw the light of day after $10 billion and 10 years spent behind the project it's definitely [13:17] not too little but it's definitely too late for Apple but that being said Apple may still have the last laugh according to CNBC 98% of new cars in the United States have Apple carplay a move that they call a trojan horse for the automotive industry and we'll leave it there so that is the story of the Apple car I want to thank you so much for watching the whole way through my name is toogo and youve been watching cold fusion and I'll catch you again soon for the next episode cheers guys have a good [13:48] [Music] [13:53] [Music] one I just want [Music] to C fustion it's new thinking