Active Stocks
Wed Apr 24 2024 12:47:40
  1. Tata Steel share price
  2. 166.40 3.29%
  1. NTPC share price
  2. 351.15 1.23%
  1. Power Grid Corporation Of India share price
  2. 290.50 1.93%
  1. ITC share price
  2. 430.00 0.19%
  1. State Bank Of India share price
  2. 771.50 -0.17%
Business News/ Companies / News/  Apple cancels decades-long electric car project in shock move
BackBack

Apple cancels decades-long electric car project in shock move

The decision was internally disclosed by Chief Operating Officer Jeff Williams and Vice President Kevin Lynch on February 27, leaving nearly 2,000 project employees stunned.

File photo of the Apple Inc logo is seen hanging at the entrance to the Apple store on 5th Avenue in Manhattan, New York (Reuters / Mike Segar)Premium
File photo of the Apple Inc logo is seen hanging at the entrance to the Apple store on 5th Avenue in Manhattan, New York (Reuters / Mike Segar)

Apple Inc. has scrapped its electric car project after a decade-long, multi-billion-dollar effort to rival Tesla, as per a Bloomberg report. The move is surprising because it marks the end of Project Titan — one of the most significant and ambitious projects in the company's history.

The decision was internally disclosed by Chief Operating Officer Jeff Williams and Vice President Kevin Lynch on February 27, leaving nearly 2,000 project employees stunned.

Many car team employees, known as the Special Projects Group (SPG), will transition to the artificial intelligence division under executive John Giannandrea, focusing on generative AI projects.

While several hundred hardware engineers and vehicle designers on the Apple car team may have the opportunity to apply for positions in other Apple teams, the exact number of layoffs remains unclear.

Reactions to the News

Investors responded positively to the news, causing a 1.2 percent increase in Apple's stock, reaching $183.37 at 2:33 pm in New York after Bloomberg reported the development.

From the competition's end, Tesla Inc. CEO Elon Musk celebrated on the social media site X (formerly Twitter), with a saluting emoji and a cigarette.

End of Project Titan and Struggles

Initiated in 2014, Project Titan aimed to develop a fully autonomous electric vehicle (EV), but faced leadership and strategy challenges from the start. Lynch and Williams took charge a few years ago after the departure of Doug Field, now a senior executive at Ford Motor Company.

Further, the move also aligns with a cooling EV market, where sales growth has slowed due to high prices and a lack of charging infrastructure. Major automakers, including General Motors and Ford, are shifting to producing more hybrid vehicles.

Even Tesla, a pioneer in the United States' EV revolution, has warned of a notably lower expansion rate this year. A forecast by UBS on February 26 predicted a deceleration in domestic EV sales growth to 11 percent next year from an estimated 47 percent growth rate this year.

Recent Project Status and Strategic Shift to AI

Analysts from Bloomberg Intelligence, Anurag Rana and Andrew Girard, believe that Apple's shift towards generative AI is strategic, considering the long-term profitability potential of AI revenue streams compared to the uncertainties in the EV market.

Despite abandoning the electric car project, Apple continues to invest heavily in other areas, spending $113 billion on total research and development over the past five years. The company recently launched the Vision Pro headset, its first new product category in almost a decade.

(With inputs from Bloomberg)

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Published: 28 Feb 2024, 06:12 AM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App