Bloomberg Businessweek: Apple Electric Car Fail III

Bloomberg Businessweek: Apple's Electric Car Fail III

Author, Businessweek. Source, Bloomberge Mailshot.

By 2016, Apple hadn’t gotten far, and internal advocates of scaling back its car ambitions began to win out. After the board of directors and senior executives began questioning the program’s viability and asking pointed questions about its costs, there were discussions about shutting down the project. But then Riccio convinced Bob Mansfield, a legendary figure at the company for leading the hardware development of the original MacBook Air and iPad, to come out of semi-retirement to shake things up.

Mansfield was among the car skeptics at Apple. His task, as he saw it, was to find out what could be salvaged from the effort. After a few months of evaluation, he decided to focus more attention on the self-driving system than on a car itself. Autonomous software, he argued, could benefit Apple in other areas, even if the company never made an actual vehicle. Other executives, notably Perica, thought Apple could license such an AI system to other carmakers without dirtying its hands in the auto business itself. Over an 18-month period from 2016 to mid-2018, Apple laid off about 120 people, a significant portion of the car project’s head count, according to people with knowledge of the cuts.


Before Mansfield persuaded Field, the former Tesla executive, to take over for him, he and Cook did manage to agree on an interim direction for the company’s autonomous driving efforts: a self-driving shuttle made in collaboration with Volkswagen for Apple employees to use at its new headquarters in Cupertino, California. That project didn’t come to fruition, either. It was seen as a distraction, and Field shut it down. He also eventually shuttered Apple’s work on batteries and other components he felt Apple could just buy off the shelf.

Under Field, full autonomy continued to be a focus even as it grew to seem less attainable. The Arizona demonstration, which the team spent nine months preparing for, was essentially a proof of concept. The team tweaked the prototype software to take turns and curves slower than usual, to make extra sure it wouldn’t injure Cook. “It was well scripted and well laid out,” says someone involved in its creation. “The intent was to show Tim that if we built this product, this is what it would look like for the customer.” (Apple bought the Arizona test track outright a year after the demo.) The team spent a lot of time working on backup controls for such a car so that a driver could extract it from tricky road situations, such as a complex construction zone. The most fully developed steering wheel substitute looked like the controller that comes with an Xbox. “It should have been either all autonomy or a wheel and pedals,” one person involved in the car’s development says, adding that the company spent a lot of time working on ways to mitigate the issue rather than on the hard problem itself.

There were other, smaller dead ends over the course of the project. Apple started planning a multi-acre engineering campus in Silicon Valley where it would design cars, but never broke ground. At one point, Apple and Ford met to discuss a proposal from the American automotive giant to sell Apple cars from its Lincoln brand, an unglamorous make that’s well-represented in rental fleets, to test the self-driving system. The talks didn’t progress past an early meeting.

For Field, Mansfield and others on the team, Cook’s indecision was frustrating. “If Bob or Doug ever had a reasonable set of objectives, they could have shipped a car,” says someone who was deeply involved in the project. “They’d ask to take the next step, and Tim would frequently say, ‘Get me more data, and let me think about it.’” In that setting, it was hard to retain talent: engineers Apple hired for the project would grow convinced things weren’t going anywhere and find jobs elsewhere. After Mansfield retired, the company tried another leadership change to boost the self-driving system. It put Williams, the COO, and John Giannandrea, Apple’s machine learning chief, in charge of overseeing Field and the project. Field left a year later, in September 2021.


Under Lynch, Apple never got to a streetworthy prototype. The self-driving technology in the company’s fleet of customized Lexus SUVs did show enough promise that there were plans to expand it to more cities in late 2024, according to people with knowledge of the plan. The idea had always been to sell self-driving as a subscription service, as Tesla does with its driver-support features. Other paid add-ons, such as Apple Music and Apple TV+ streamed to the vehicle, would help make up for the uninspiring margins on car hardware. (Some internal estimates pegged Apple’s cost to produce the car at about $120,000, far more than the $85,000 the company had wanted to charge for it.)

Last year, Apple pivoted one last time. Designs were tweaked to move from Level 5 down to Level 2, the level of Tesla’s current Autopilot, which can control both speed and steering but is assistive technology for drivers rather than their replacement. In keeping with that, the new design also incorporated a more traditional automotive interface: a steering wheel and pedals. “They finally smartened up,” says an Apple executive. “I was like, ‘Guys, you could have done this 10 years ago!’”

But the company had ended up where it began a decade earlier, with a product little different from what was already on the market and a basic, not-great self-driving system. “Kevin Lynch is a sensible person,” says an Apple executive involved in the car decision making. “He tried to bring a pragmatic view to it.” When asked, he made clear that true autonomy might be another decade off. He seems to have finally convinced Apple’s leadership that that was a problem without an affordable or reliable solution in the foreseeable future.


Recently, members of the Apple car organization were studying how the company would produce the less-advanced car. It considered working with Magna International Inc., which builds some models for Jaguar, BMW and Mercedes. But the indecision at the top of the company filtered down, sapping morale. Apple declined to comment for this story, as did BMW, Ford, McLaren, VW and Mercedes. The former Apple executives named in this story didn’t respond to requests for comment, nor did Canoo.

Around the beginning of 2024, Cook, who’s known for making decisions based on consensus, began seriously considering shutting down the project. “That’s when you started to see members of the leadership of Titan look for jobs at other companies and within Apple,” says someone with knowledge of the matter. People working on powertrains and other car-related engineering products began to depart.

In the evening of Monday, Feb. 26, the roughly 2,000 employees of Apple’s Special Projects Group received an email announcing a 10 a.m. all-hands meeting the next day. On Tuesday morning, the employees gathered in conference rooms and at desks at Apple’s Silicon Valley offices were told that Project Titan was winding down immediately. Lynch and Williams broke the news on a video call, and they didn’t explain the decision.

The meeting lasted about 12 minutes. Both men thanked the staffers for their work and got straight to the reorg and layoffs. Some employees would immediately get shifted to Apple’s AI division, and some would move over to software engineering. A chunk of the team, though, was immediately without a job. Hardware engineers would have the opportunity to apply for roles in other groups, but there aren’t spots for everyone. Other employees, such as the hundreds of car-specific engineers, test track technicians, self-driving car testers and automotive safety experts, received emails with their severance packages. As for the Arizona track, Apple is already working to sell it. —Mark Gurman and Drake Bennett