What's Up With Apple: Apple a Threat to Tesla? Trouble at the App Store?

Technology

Published: February 11, 2021 8:24 am

Six months ago, it was not clear to Loup Ventures analyst Gene Munster that Apple Inc. (NASDAQ: AAPL) was really interested in building an Apple Car. Now, he told CNET in a Wednesday interview, “[C]learly Apple has ambitions to build a car.”

That said, Munster wonders why the possibility that Apple will build an all-electric, self-driving vehicle has not had a more negative effect on Tesla Inc. (NASDAQ: TSLA) stock. Munster added, “I think Apple is Tesla’s biggest competitor.”

Loup Ventures, and Munster in particular, have been huge Apple and Tesla bulls. In December, the firm predicted that 30% of all new vehicle sales would be electric vehicles (EVs) by 2025 and that Tesla would own about a third of the global market for EVs by then. By 2030, he now says, Tesla’s share of the global market will be 25%. The obvious question, then, is why Apple would want to slug it out with dozens of other carmakers for some of that 5% share.

What Munster told CNET Wednesday was that he believes both companies can “coexist” in the rapidly changing auto market. Future transportation will be driven by the tech industry, not traditional automakers, according to Munster. That’s why he thinks Apple could have as much as 15% of the global market for EVs by 2030.

The North Dakota state senate is considering a bill that would bar companies like Apple and Google from forcing app developers to sell products only through company app stores and in-app payment systems. Apple is fighting similar restrictions in Europe and with its own app developers. In August, Epic Games added its own in-app payment system to its popular Fortnite game, leading Apple to remove the game from downloads from the App Store.

Apple’s privacy software manager, Erik Neuenschwander, has testified against the North Dakota legislation, calling the restrictions a threat “to destroy the iPhone as [we] know it” because they would “undermine the privacy, security, safety, and performance that’s built into iPhone by design.” Neuenschwander was referring to Apple’s tight control of its ecosystem, which forces developers to play by the company’s rules, thus maintaining a consistent user experience for users of Apple products. This is no small thing, but Apple may have to make more changes if it wants to avoid antitrust and anti-competitive threats from state and national governments.

Finally, iPhone competitor and one-time iPhone chipmaker Samsung has filed documents asking to build a state-of-the-art semiconductor foundry near Austin, Texas. The estimated cost of the chipmaking facility, called a fab, is estimated at more than $17 billion and would take about three years to build. The fab would employ around 1,800 people when it is in full operation.

Samsung already has a fab in Texas, so the state has a leg up in competing for the deal with Arizona, where Taiwan Semiconductor Manufacturing (TSMC) and Intel already have fabs, and New York, where GlobalFoundries has a plant. TSMC is also considering a new fab in Arizona to manufacture leading-edge chips for Apple and others. Since 2015, TSMC has been the exclusive supplier of the iPhone’s processor chip after Apple cut ties with Samsung because the Cupertino company presumably saw no reason to support its main competitor with the one hand while battling for smartphone supremacy with the other.