Apple has finally abandoned its plans to build its own electric vehicle after the project reached a "make-or-break point," according to a report from Bloomberg.
Bloomberg reported that Chief Operating Officer Jeff Williams and Kevin Lynch, a vice president tasked with managing the project, informed employees on Tuesday that it will begin winding now its plans to enter the automobile market. Staff working on the effort will either be laid off or transferred to the company's artificial intelligence division.
The outlet explained:
The two executives told staffers that the project will begin winding down and that many employees on the car team — known as the Special Projects Group, or SPG — will be shifted to the artificial intelligence division under executive John Giannandrea. Those employees will focus on generative AI projects, an increasingly key priority for the company.
The Apple car team also has several hundred hardware engineers and vehicle designers. It’s possible they will be able to apply for jobs on other Apple teams. There will be layoffs, but it’s unclear how many.
Bloomberg added that the decision was taken as the result of recent discussions among senior executives that the project was on the brink:
Apple’s most senior executives finalized the decision in recent weeks, according to the people. It comes just a month after Bloomberg News reported that the project reached a make-or-break point. The most recent approach discussed internally was delaying a car release until 2028 and reducing self-driving specifications from Level 4 to Level 2+ technology.
Under Apple's original plans, dubbed Project Titan, the company hoped to enter another sector by manufacturing a luxurious and fully autonomous electric vehicle.
The bombshell move came as a surprise to investors, many of whom were skeptical about the project since its inception in 2014. Apple shares also rose on the news.
Among those celebrating the news was Elon Musk, whose company Tesla is the highest valued EV firm in the world, who posted an emoji of a saluting emoji and a cigarette.
— Elon Musk (@elonmusk) February 27, 2024
The project's abandonment comes amid declining fortunes for the EV industry, as many leading car manufacturers cut their production targets amid a sharp fall in demand and concerns about maintenance costs.
Last week, the California-based, all-electric manufacturer Rivian Automotive Inc. announced plans to lay off 10 percent of its workforce and lower production targets. Meanwhile, Ford and General Motors have both incurred multi billion dollar losses on their respective ranges, with results coming in even worse than expected.
According to a recent report by The New York Times, the Biden administration also plans to scrap many of its transition targets as part of an election-year "concession" to automakers and labor unions on whose votes he depends.
"Instead of essentially requiring automakers to rapidly ramp up sales of electric vehicles over the next few years, the administration would give car manufacturers more time, with a sharp increase in sales not required until after 2030," the Times reported at the time. "The change comes as President Biden faces intense crosswinds as he runs for re-election while trying to confront climate change."
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