The anticipated Apple's decade project of producing electric vehicles has been canceled. Apple was rumored to start production of its own branded electric car in 2024.
The US tech giant Apple has decided to dedicate all its resources to Artificial Intelligence(AI).
The halt on the decade-old project, which was reported on Tuesday and will see employees shifted to the firm’s AI division, was welcomed by markets.
Apple kicked off Project Titan 10 years ago, at a time when the promise of self-driving vehicles was all the rage in Silicon Valley.
It originally said it hoped to release a self-driving vehicle as early as 2024.
The Apple car team was reportedly known as the Special Projects Group as part of its chief executive Tim Cook’s Project Titan.
As it spent billions of dollars on research and development, the company was initially rumored to be working on a fully autonomous vehicle without a steering wheel and pedals.
The team was understood to still be years away from producing a vehicle.
According to Ray Wang, founder, and chief executive of Silicon Valley-based consultancy Constellation Research, the cancelation was a long waited and a smart decision.
“The market demand for EVs is not there and AI is where all the action is,” he added.
Apple has been exploring other opportunities beyond the iPhone and computers, including its recently launched Vision Pro virtual reality headset.
Research firm Counterpoint highlighted that the decision came as the market for AI in consumer electronics is growing sharply.
“Preliminary data suggests shipments of generative AI smartphones will exceed 100 million units in 2024,” said its senior analyst, Ivan Lam.
Counterpoint predicts that number could hit more than 500 million by 2027.
Demand for EVs has slowed in recent months as borrowing costs remain high, which has made the market increasingly competitive as major players try to win over customers.
In recent months, US motor industry giants Ford and General Motors have postponed plans to expand EV production.
Last week, electric truck maker Rivian announced it would cut its workforce by 10% and said it did not expect any growth in its production this year.
In January, Tesla warned that its sales growth would be weaker this year than in 2023.
The company, which is led by multi-billionaire Elon Musk, has been cutting prices in key markets around the world, including Europe and China, as it faces tough competition from Chinese rivals such as BYD.
Musk responded on the social media platform X, formerly known as Twitter, to a report that the Apple project was being wound down with emojis of a salute and a cigarette.
