On the future of Apple and the case for an Apple car

Well-respected Apple analyst Gene Munster of Piper Jaffray gave a presentation on the company’s future at Business Insider’s Ignition conference and it’s really good. The entire presentation is here and worthwhile: Future of Apple presentation by analyst Gene Munster at Business Insider Ignition – Business Insider.

Earlier I wrote about how I don’t think Apple will get into the car business. However, after reading what Munster said, I can see how others think Apple will get into cars. Specifically, here’s are the pro-car points he makes:

  • Apple could align with and compete in the BMW market: BMW sold 1.8M cars in CY14.
  • If Apple priced them at $75K, 1.8M cars is $135B in revenue
  • Apple could start small: sell 30K in first year (similar to Tesla’s 35K in CY14)
  • In a market of 88M cars in CY15, 1.8M cars is nothing

The approach laid out in those points is a similar game plan that Apple followed in the smart phone market.

The more I thought about it, the more I am leaning towards Apple getting into the car business, at least in a limited way. The bulk of the market would not be Apple and there likely would still be lots of car manufacturers after Apple jumps in, just like there are many smartphone makers. But Apple would take over the most profitable part of the car manufacturing marketplace.

Read the analyst report: you will get great insight into where Apple is heading.

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