According to Bloomberg, Apple Inc. has canceled its electric car project following a decade-long, multibillion-dollar campaign to compete with Tesla. The move is startling because it concludes Project Titan, one of the company’s most major and ambitious programs.
On February 27, Chief Operating Officer Jeff Williams and Vice President Kevin Lynch announced the decision internally, stunning almost 2,000 project staff.
Many auto team personnel, known as the Special Initiatives Group (SPG), will move to the artificial intelligence division led by executive John Giannandrea, which will focus on generative AI initiatives.
Several hundred hardware engineers and vehicle designers on the Apple automobile team may have the opportunity to seek roles in other Apple teams, but the actual number of layoffs remains unclear.
Reactions to news
Investors reacted warmly to the news, with Apple’s stock rising 1.2 percent to $183.37 at 2:33 p.m. in New York, after Bloomberg reported the development.
Elon Musk, CEO of Tesla Inc., greeted the end of the competition on the social media site X (previously Twitter) with a saluting emoji and a cigarette.
End of project titan and struggles
Project Titan, launched in 2014, attempted to create a completely autonomous electric vehicle (EV), but it had leadership and strategic issues from the outset. Lynch and Williams took over a few years ago following the retirement of Doug Field, who is now a senior executive with Ford Motor Company.
Furthermore, the move is in line with the cooling EV industry, where sales growth has slowed due to high prices and a lack of charging infrastructure. Major automakers, including General Motors and Ford, are shifting to producing more hybrid vehicles.
Even Tesla, a pioneer in the United States EV revolution, has predicted a far lower growth rate this year. On February 26, UBS forecasted that domestic EV sales growth will slow to 11 percent next year, down from an expected 47 percent this year.
Bloomberg Intelligence analysts Anurag Rana and Andrew Girard saw Apple’s pivot to generative AI as strategic, citing the long-term profitability potential of AI revenue streams over the uncertainty of the EV market.
Despite dropping the electric car project, Apple has continued to invest extensively in other areas, spending $113 billion on overall R&D over the last five years. The company recently launched the Vision Pro headset, its first new product category in almost a decade.
