Morgan Stanley analyst Katy Huberty spoke out about the potential of an "Apple Car", a vertical integration of software, hardware and services to disrupt the auto sector. Huberty also gave praise to Apple CEO Tim Cook and noted that Steve Jobs would be proud.
Tim Cook announces an Apple Car via YouTube/qfulm. This fan-made image was created by Tim Cook.
Apple Car's Vertical Integration
Although some reports have suggested that Apple's automotive ambitions may be limited to services and software, Huberty stated that Apple is more successful when there is vertical integration. This is evident in the iPhone. Huberty stated that Apple would like to have a hand in designing the vehicle, how the software communicates with hardware, and choosing the best technologies and components.
Huberty said, "Imagine what will make the car of tomorrow different." It's vertical integration of different components and hardware design. Software is the final component. Finally, it's about the services that can also be delivered in that vehicle. It's all about trusting and establishing credibility with consumers, and a brand when it comes down to consumer products. Apple is a leader in all these categories.
Huberty stated that once Apple "gets the car right", the company will be able to introduce additional services. Although she didn't give any examples, it is possible to imagine an Apple Car with Apple Music integration as in the Porsche Taycan and built-in displays for rear passengers that allow them to watch Apple TV+ or play Apple Arcade.
Ming-Chi Kuo, an Apple analyst, stated in a December 2020 research paper that an Apple car is unlikely to be on the market before 20252027.
Tim Cook's Legacy
Last week was the 10th anniversary that Cook was named Apple's CEO, after Steve Jobs retired due to declining health. Huberty spoke about Cook's time in the podcast interview and said that Jobs would be proud.
Huberty said that Tim Cook did a remarkable job in preserving Steve's legacy and building his own. "Steve was all about design, innovation and getting into the weeds. Tim has allowed the company's culture to continue, but at the time he's also layered in some softer aspects that are more difficult to measure." She added that Cook successfully scaled operations while putting greater emphasis on areas such as employee benefits, charitable giving and environmental responsibility.
She concluded that "I believe that Steve would be proud of how Tim has built his legacy while also protecting the culture around design and innovation that Steve began."
