Technology analysts believe Apple will produce a car to go on sale in 2019, its average selling price will be $55,000 (£36,000) and the iPhone maker will sell 200,000 vehicles in its first year. The claims come as part of a 68-page note by Jefferies & Co, who believe Apple will use the car to rival Google's own vehicle project.
Analyst Sundeep Bajikar claims his analysis of the car market suggests it is "ripe for disruption" and Apple is "well positioned to introduce a car, potentially as early as 2019". This is around the same time that self-driving cars are expected to go on sale from Google and others; a recent report claims Apple's first car will have some autonomous features, but not drive itself entirely.
Bajikar was joined by his colleague Mark Lipacis, who believes Apple "probably is developing a car". Lipacis says Apple would do this to "increase potential for longer-term revenue and profit growth... fend off ecosystem threats posed by Google's car, and... leverage and extend its premium brand image by introducing a new category that we think consumers are likely to be interested in".
Lipacis goes on to say that he has based his calculations on Apple pricing the car at an average of $55,000 and selling 200,000 units in its first year. This seems incredibly high, as Tesla, which has been in business for over a decade, only plans to sell around 55,000 vehicles in 2015.
Nevertheless, if these figures, published by Barron's, are realised, then the Jefferies analysts reckon Apple's earnings per share will rise by $0.32 and around $3 will be added to Apple's stock price, which currently sits at $115. They also predict the car to have an operating profit of 20%, but that Apple will struggle to match the iPhone's level of 30%; for comparison, a $90,000 Tesla has a profit margin of just 6.3%. The analysts believe the iPhone will remain responsible for the majority of Apple's business.
This transition to a lower-margin business has prevented news of Apple's car development from convincing investors to pump more money into Apple stock.
Despite a lack of physical evidence for now, Apple is widely believed to be working on a car and has a division of up to 1,300 employees working on what it refers to internally as 'Project Titan'.