Apple in talks with Mercedes, Ford, Tesla and new Apple Car report

Apple in talks with Mercedes, Ford, Tesla and new Apple Car report

Tesla Model Y

As you may be familiar with by now, Apple has officially canceled its project to build an electric car. The project never saw the light of day and wasn’t even confirmed by Apple, but the company had been working on its own car since 2014. Following reports that Apple had approached Tesla for a partnership, we now know that the company has also talked to Mercedes-Benz about building an Apple Car together, per Bloomberg’s Mark Gurman.

As reported by Bloomberg on Wednesday, Apple tried to negotiate a partnership with Mercedes-Benz to build an Apple Car. The report says that talks “progressed further” for months and both companies had been actively working on an electric car project together. However, while Mercedes would build the Apple Car, it also wanted to sell its own cars using Apple’s self-driving platform.



Apple eventually withdrew from the partnership as the company’s executives were confident that Apple could build a car on their own after all the early work with Mercedes. The company also reportedly discussed with Ford the possibility of the car manufacturer selling an Apple Car under its Lincoln brand, but the talks “didn’t progress past an early meeting.”

In the past, Apple had some discussions with Elon Musk about buying Tesla to build its car. However, Apple CEO Tim Cook reportedly pulled the plug on the deal during early negotiations. At some point, Apple executives met with Musk again to discuss other ways of collaborating, such as buying batteries from Tesla.

Interestingly, Bloomberg says that Apple came close to a deal to buy luxury automaker McLaren. At the time, Jony Ive was still working for the company and would get a new design studio in London to work on the project. The deal didn’t go ahead either.

The idea of an Apple Car came from Steve Jobs

Although the Titan project (the codename for the Apple Car) emerged in 2014, the idea came from Apple co-founder Steve Jobs years ago. “In the wake of the 2008 financial crisis, with American car companies on the brink of failure, the Apple chief executive even floated the idea of acquiring General Motors Co. for pennies on the dollar,” the report says.



Tony Fadell, considered the father of the iPod, confirmed that he and Jobs talked about “what would be this generation’s new Volkswagen Beetle.” However, as the company focused on making the iPhone a hit, Jobs decided it wasn’t time to start a car project.

An ambitious project

Under Cook’s direction, the Titan project was quite ambitious. One of the prototypes looked like a white minivan with “rounded sides, an all-glass roof, sliding doors and whitewall tires.” The vehicle would have a giant screen, a powerful audio system, and reclining seats that made the cabin look like a club.

The Apple Car was first designed to have a Level 5 autonomous driving system, meaning that it would drive itself entirely using its onboard computer with no steering wheel or pedals. The only manual controls would be a “video-game-style controller or iPhone app” which would serve as a backup.



Doug Field, head of the project, warned executives about the challenges of building an autonomous car and suggested scaling back the goals to Level 3, which requires a human driver to take control in some situations. However, Apple executives still wanted a Level 5 car.

Frustrations over the car’s project

The project hadn’t made much progress by 2016 and the board of directors was already questioning the viability of the Apple Car. Dan Riccio then convinced Bob Mansfield, known for his role in Apple’s hardware team, to join the car team. Mansfield focused on working on the autonomous driving system rather than the car itself.

Some executives believed that Apple could license its technologies to other car manufacturers. Mansfield and Cook agreed to build a self-driving shuttle in partnership with Volkswagen to be used by Apple employees on its campus. However, the project was seen as a distraction and was also shut down.

The report says that many Apple executives have been frustrated by Cook’s indecision over the direction of the Titan project. In the meantime, as the project was going nowhere, engineers hired to work on the car were leaving Apple to work for other companies. From 2016 to 2018, Apple had already laid off 120 people from the car project.

Sources told Bloomberg that Apple has estimated the production cost of its car at around $120,000, far above the target of $85,000.

The end of the Apple Car

Apple has made a lot of changes to the leadership of the Titan project since then, but none of them have resulted in anything promising. At one point, Apple put a fleet of Lexus SUVs customized with its own self-driving technology on the streets for testing purposes. The plan was to expand these tests to more cities by 2024. The company wanted to sell self-driving as a subscription service.

Last year, before giving up on the project for good, the designers and engineers decided to experiment with a Level 2 autonomous car – the same as the Tesla Autopilot. But that would make the Apple Car look like any other electric car already available on the market without much of a difference.

Kevin Lynch is said to have convinced Apple’s leadership that building a fully autonomous car would take at least another decade. Earlier this year, Cook was already considering shutting down the project as key engineers and executives were already joining other companies.

On February 26, around 2,000 Apple employees received an email about a meeting the following day. Lynch and Williams then confirmed that the Titan project was being shut down without further explanation. Some of the engineers have been relocated to Apple’s AI and software division.

The failed car project cost Apple around $1 billion a year.

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