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Apple can't make money on cars, says former GM executive

Apple can't make money on cars, says former GM executive

Connected Car
September 22, 2015

Former General Motors vice chairman Bob Lutz apparently has no personal knowledge of an Apple-built electric car, according to AppleInsider. Nevertheless, that’s not stopping him from saying that Cupertino’s shareholders should be “very upset” that the tech giant might be looking to enter the automobile industry.

In an appearance on CNBC’s “Closing Bell,” Lutz said that no company in the world has “made a nickel” on electric cars so far. Calling the venture a “giant money pit,” Lutz suggested that Apple’s inexperience in the industry would make its efforts doomed to failure. It seems that we’ve heard that line before.

Oh right, that’s because Palm CEO Ed Colligan responded to rumors of the first iPhone by telling a correspondent from The New York Times that “PC guys are not going to just figure this out. They’re not going to just walk in.” Apple not only walked in, but it dominated the industry and Palm is, well, pretty much defunct.

We also heard that sort of criticism when the iPad was announced in 2010. Microsoft founder Bill Gates claimed that netbooks with real keyboards and touch input were superior and that there was nothing in the tablet that made him wish Microsoft had come up with the idea first.

I’m not saying that Apple is making a car, because I don’t think it is. I think, instead, Cupertino is developing the components that would control such a car, and the tech giant will partner with existing automobile manufacturers to bring the system to market. Something is going on in Sunnyvale, and all Tim Cook will say on the matter is that Apple looks “at a number of things along the way and we decide to put our energy into a few of them.”

If, however, Apple was going to make its own vehicle, I wouldn’t be so quick to dismiss Cupertino’s efforts based on a lack of experience. If there’s one thing Apple has proven, it’s that the company is fully capable of entering a market completely different from usual and experiencing tremendous success.

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