Morgan Stanley analyst Katy Huberty discussed the long-running “Apple Car” project recently, saying she expects Apple to invest significantly in researching and developing a “vertically integrated solution.”
Huberty’s comments came in a research note focused on Tesla and shared by AppleInsider. While most of the information in the note was related to Tesla’s position within the technology and automotive industries, Huberty provided information on Apple’s ongoing vehicular tech development.
Huberty expects Apple to spend nearly $19 billion on Research & Development this year, comparing that number to the $80 to $100 billion spent on R&D across the entire auto industry. Hubert sees that as the reason why Apple and other tech companies are probably going to be “disruptive over time” in the auto market.
Huberty also commented that Apple sees vehicular tech as a “large market where (it) can contribute to a better solution,” similar to how it views health and financial technologies.
“The end game can’t just be a more advanced version of CarPlay in partnership with other auto makers,” Huberty said. “They need to control the design, the guts, and the experiences and services on top of the platform.”
When asked if Apple and Tesla would team up, Huberty said she sees Apple and Tesla remaining competitors, since Apple’s ambitions indicate it may release a competitor to the Tesla.
Apple has long been rumored to be working on an “Apple Car,” although no one is sure what form such a project will take. Most recently, rumors have suggested the end result will be an actual Apple-produced vehicle.
Huberty also spoke about Apple’s transition from a “seller of devices” to more of a services-based company, saying “Apple’s financial model is behaving less like a transactional hardware business and more like a digital service.”
Morgan Stanley maintained its $326 price target for AAPL.
