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Apple Car scrapped? Secret driverless vehicle takes a backseat

The Apple Car may never see the light of day, as a new report describes how Apple has “drastically scaled back its automotive ambitions”.

Apple has decided to pull back on the development of its long-rumoured electric vehicle, according to Bloomberg. Apparently, the iPhone maker has now decided to refocus its efforts on developing an autonomous driving system, rather than taking on Tesla with an actual vehicle of its own.

This shifting of priorities has reportedly led to hundreds of job cuts in the secretive Project Titan team. According to the report, Apple is keeping staff numbers “steady” by hiring new people to work on the driverless car system, following a lengthy spate of reassignments, redundancies and voluntary departures.

It’s believed that Apple started designing its own driverless electric vehicle back in 2014, with the company embarking on an “aggressive hiring spree” to meet its purported 2020 launch goal. But Bloomberg remarks that Apple began to struggle early on:

By the end of 2015, the project was blighted by internal strife. Managers battled about the project’s direction, according to people with knowledge of the operations. ‘It was an incredible failure of leadership’, one of the people said. In early 2016, project head Steve Zadesky, a former Ford Motor Co. engineer and early iPod designer, left Titan.”

Zadesky was quickly replaced with Apple veteran Bob Mansfield, who quietly assumed charge of the Apple Car development. But as Bloomberg explains, Mansfield quickly shuttered hopes of a vehicle:

“About a month later, Mansfield took the stage in a Silicon Valley auditorium packed with hundreds of Titan employees to announce the strategy shift, according to people who attended the meeting. Mansfield explained that he had examined the project and determined that Apple should move from building an outright competitor to Tesla Motors Inc. to an underlying self-driving platform.”

According to the report, Apple has particularly struggled with automotive supply chains, which is no surprise. Former GM and BMW exec Bob Lutz was one of the more outspoken Apple Car sceptics, and was quoted in February last year as saying:

“When it comes to actually making cars, there is no reason to assume that Apple, with no experience, will suddenly do a better job than General Motors, Ford, Volkswagen, Toyota or Hyundai. So I think this is going to be a gigantic money pit, but then it doesn’t matter. I mean Apple has an embarrassment of riches, they don’t know where to put the cash anymore. So if they burn 30 or 40 billion dollars in the car business, no-one’s going to notice.”

Related: Death by Driverless Car

He added: “If I were a shareholder I’d be very upset, because they’re currently engaged in a very high-margin business; and the automobile business, at best, is a very low-margin business. And you can’t show me one company in the world that, to date, has made a nickel on electric cars. There is absolutely no reason to assume that Apple is going to be financially successful in the electric car business.”

Speaking to TrustedReviews at CES 2016, Dave Anderson, senior manager of Automotive Integration at Nvidia, said that Apple would find it challenging to build a car: “The longstanding tradition of making cars is something that is a significant learning curve, and even with a company that’s as sophisticated as Apple…that process still takes time.”

But others were more hopeful, including Don Butler, Ford’s executive director for Connected Vehicles and Services, who told TrustedReviews earlier this year: “We welcome others joining. We welcome the activity that’s in the space. We think it’s exciting. It’s actually chang that we are embracing. So I think Apple can do it. I think Google can do it.”

Bloomberg reports that Apple is trying to make sure it has the flexibility to return to designing its own vehicle in the future, but that the driverless car system is the focus for now.

Related: CES 2017

Watch: Tesla Model S review

Do you think Apple is right to give up on building its own vehicle? Let us know in the comments.

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