In the midst of a lovely evening in Freemont, California, this past Thursday night Tesla CEO, Elon Musk, introduced the world to Tesla's latest electric car. The Model 3. Consider the automotive world changed with the clock ticking for most every auto maker in the world. Compete with Tesla or get blown away. Think I'm kidding? Like the era of mainframes and IBM dominating the computer industry, only to have Apple change the paradigm, Tesla is the Apple of the automotive world.
Apple's big un-secret of exploring the automotive industry is well known, but will the green light be given for Apple to actually enter the car market? The answer seems to be an overwhelming yes. Tesla's Model 3 is now the car to beat, but Apple's known this for quite some time. Over the past several years Apple and Tesla have been prying employees away from one another, thus an obvious assumption is that Apple has known what they will need to achieve in order to top Tesla's first attempt at a quasi-mass market four-door sedan. So when, exactly, will Apple's own vehicle arrive?
The sleek looking Model 3 will start at $35,000, have a range of at least 215 miles per full charge and reach 0 - 60 in under 6 seconds, while it's radical dashboard (containing one big screen in the center stack), is said to be only a concept, not much else is known. Overall the Tesla event was a mere sheet metal reveal, leaving the car rather undefined, but there is a clear reason for this. The Model 3 isn't done yet. In fact, Musk announced it would be shipping late next year, and he seemed to be smirking and hedging even that rough timeline. Based on Tesla's track record the Model 3 is more likely to start shipping sometime during the second or third quarter of 2018, and even then, shipments will be but a trickle, as Tesla's ramp cycles are amazingly slow.
Tesla's 2018 - 2019 Model 3 shipping timeframe is perhaps the best news for Apple that came out of the event. Apple still has time to get their car aspirations in order. And while Musk boasted about the history of Tesla's Freemont plant being capable of manufacturing 500,000 cars a year, itis questionable as to whether Tesla will ever be able to do the same, and certainly when Tesla could possibly achieve that production volume is perhaps the most important question.
Apple's advantages over Tesla are numerous. As of late, Apple has been winning the employee poaching wars, has vast technology know-how, and can bring scale to any product in any market they wish to enter. In other words, Apple has cash and talent that Tesla, or any auto maker in the world, could only dream about. The result is that Apple is likely to compress their development timeline and deliver a truly mass market electric car others cannot quickly achieve (or dare I say copy).
Tesla's Model 3 may start at $35,000, but the versions and features most people will largely want, won't be in reach without forking out $45,000 - $55,000. Expect Apple to have manufacturing scale and sales that bring their entry vehicle into the stunningly competitive $25,000 - $35,000 range. Most importantly, when Apple launches their car, within 3-6 months you'll actually be able to get one.
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