The internal announcement was made on Feb. 27, shocking the nearly 2,000 employees involved in the project. The people who shared the news requested not to be identified because the announcement wasn’t public.
The decision was shared by Apple Chief Operating Officer Jeff Williams and Kevin Lynch, the vice president in charge of the project.
Williams and Lynch informed employees that the project will start winding down and that many employees on the car team will be transferred to the artificial intelligence division under executive John Giannandrea. Those employees will begin working on generative AI projects, an increasingly key priority for Apple. (Related: Apple starts to embrace artificial intelligence, installs AI-powered features in iPhones.)
Apple's car team also includes several hundred hardware engineers and vehicle designers. There's a chance that they will be able to apply for jobs on other Apple teams.
Layoffs are pending, but there isn't any information on how many employees will lose their jobs.
Apple's decision influenced by "cooling" EV market
The move was welcomed by investors, who were relieved and sent Apple shares skyrocketing after the news was revealed. The company's stock was up by at least one percent at $182.63 by the close in New York on the same day.
The decision to finally cancel the project is shocking because this means the company is ending a multibillion-dollar effort called Project Titan that would have given Apple a leg up into a new industry.
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Apple began working on a car as early as 2014, with the company targeting a fully autonomous EV with a limousine-like interior and voice-guided navigation.
However, the project floundered from the start, with Apple changing the team's leadership and strategy multiple times. Lynch and Williams took charge of the project several years ago after the departure of Doug Field, who is currently a senior executive at Ford Motor Co.
Unfortunately, Apple was years away from finalizing a car and contemplated several designs. Aside from designing the vehicle, the tech giant struggled with self-driving technology.
Apple has road-tested its system since 2017 with a Lexus SUV exterior, with the company testing dozens of vehicles on roads in the United States. The company also tested more secretive components on a gigantic track in Phoenix that was formerly owned by Chrysler.
But the company finally raised a white flag amid a cooling market for EVs. Sales growth lost steam in recent months following high prices and the often-criticized lack of charging infrastructure that discouraged mainstream buyers from shifting to all-electric vehicles.
A forecast by financial services company UBS AG predicted that domestic EV sales growth will decelerate to 11 percent in 2024 from an estimated 47 percent growth rate in 2023.
Apple board worried about spending millions on a project that may not take off
Insiders shared that Apple's most senior executives approved the decision in recent weeks.
The decision was made after reports revealed that the doomed project reached a make-or-break point. The most recent approach discussed internally was postponing a car release until at least 2028 and reducing self-driving specifications from Level 4 to Level 2+ technology.
Apple had employees from across the car industry working on the project, including several designers from known companies like Aston Martin, BMW, Lamborghini and Porsche.
Under the new arrangement, Lynch will report to Giannandrea. The former previously reported to Williams, who has also managed software engineering for the Apple Watch.
Apple previously had plans to develop a car without a steering wheel and pedals, but the tech giant also abandoned those plans. The company also worked on a remote command center that could take over for a driver.
Earlier, Apple had estimated that the EV would cost around $100,000. However, company executives worried about the vehicle being able to provide the profit margins that Apple typically enjoys on its popular products.
Additionally, Apple's board raised concerns about continuing to spend hundreds of millions of dollars a year on a project that may become an actual product.
Despite the expensive canceled EV project, Apple continues to invest heavily in other areas. And while Apple has canceled other projects before, such as a plan to make a TV set that was abandoned in 2015, there aren't many on the same scale as the EV project which took so long to finish, involved many employees and cost billions of dollars in expenses.
Visit RoboCars.news for more stories about the EV push in America.
Watch the video below to learn more about Apple's canceled EV project.
This video is from The Resistance 1776 channel on Brighteon.com.
More related stories:
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Apple to launch own EV in 2028 after SCRAPPING plans to create a fully autonomous car.
Electric car sales growth slows by nearly 50% in 2023.
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