Days after Apple’s ‘Spring Forward’ Apple Watch event, shareholders discussed the possibility of either purchasing Tesla or linking up with the electric car maker at Apple’s annual shareholder meeting. Tim Cook fielded questions from key investors on the future of the company and the reoccurring theme that Apple might enter the car manufacturing industry.
Cook fended off these questions by placing more emphasis on CarPlay—Apple’s iOS-based vehicle infotainment system. You can’t blame the shareholders line of questioning, though, following rumors about the company’s plans to develop its own brand of electric cars. In 2014 Apple hired a couple of automotive engineers and also discussed plans to build longer-lasting batteries for electric cars. These strategic moves have reinforced the idea of an Apple Car in the minds of the public and apparently in the minds of its shareholders as well.
In related news, Tesla founder and CEO Elon Musk is apparently not enjoying speculation about being acquired. According to a CBC news article Musk recently told analysts and investors that predicts Tesla will be worth more than Apple within a decade. He stressed that Tesla investors shouldn’t read much into the rumors about an outright purchase.
This certainly wouldn’t be the first time a company has denied purchase allegations only to do a 180 degree turn by selling anyway. The fact that Apple is currently worth $700 billion compared to Tesla’s $25 billion showcases the fact that cash is no problem for Apple. Apple could buy Tesla outright six times over and still have a “Tesla and some change” left over just with the cash it has on hand. The real issue will be getting a serial entrepreneur like Elon Musk to relinquish his hold on a company he holds close to his heart.
Never say never. I believe if Tesla falls into the position of needing more loans like the $465 million it got from the US government, a sale or partnership with Apple will be in its not too distant future.
Do you think Apple will actually develop an electric vehicle and get into the car manufacturing business? Do you think Apple should acquire Tesla? Share your thoughts in the comments below.