Apple Rises As Wall Street Digests Report Of Self-Driving Car Plans

Shares of Apple (AAPL) are in the spotlight on Tuesday following a report yesterday afternoon from Reuters claiming that the company is moving forward with its self-driving car technology and is aiming at 2024 to launch a passenger vehicle that would include its own battery technology. Commenting on the news report, Morgan Stanley analyst Adam Jonas said that Apple could present "far more formidable competition" for Tesla (TSLA). While Citi analyst Jim Suva acknowledged that the iPhone maker would be Tesla's most director competitor, the analyst said he is "very skeptical" that Apple will actually produce a car.

SELF-DRIVING CAR PLANS: Apple is moving forward with self-driving car technology and is targeting 2024 to produce a passenger vehicle that could include its own breakthrough battery technology, Reuters' Stephen Nellis, Norihiko Shirouzu, and Paul Lienert reported, citing people familiar with the matter. The iPhone maker’s automotive efforts, known as "Project Titan," have proceeded unevenly since 2014 when it first started to design its own vehicle from scratch, the authors noted. Doug Field, an Apple veteran who had worked at Tesla, returned to oversee the project in 2018 and laid off 190 people from the team in 2019, the publication added. According to Reuters, central to Apple’s strategy is a new battery design that could “radically” reduce the cost of batteries and increase the vehicle’s range.

'FAR MORE FORMIDABLE' COMPETITION TO TESLA: After the Reuters report citing undisclosed sources said Apple is targeting production of a passenger vehicle as soon as 2024, Morgan Stanley analyst Adam Jonas noted that it has "long been the auto and tech hardware teams' collective working assumption" that Apple will design and engineer a car one day. The firm's teams have also "long felt" that tech players like Apple "represent far more formidable competition" potentially for Tesla than the legacy automakers, Jonas said.

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