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The Apple Store on 5th Avenue in the New York City borough of Manhattan, seen in 2015.
London CNN –
According to multiple media reports, Apple has abandoned a decades-long effort to build an electric car, ending a project that was seen by some as potentially transformative for the auto industry.
Many employees are working on the project, known internally as “Project Titan.” will be moved to the company's artificial intelligence division, according to Bloomberg, which initially announced the decision citing people familiar with the matter. CNN has reached out to Apple (AAPL) for comment.
The news comes at a time when electric vehicle (EV) sales have been disappointing, prompting several major automakers to withdraw investments and cut prices. AI, on the other hand, is having a moment and Apple has reported Shifting resources could help close the gap with rivals like Microsoft and Google, which have embraced the groundbreaking technology.
“The tech giant is following a trend as investor enthusiasm for investing in electric vehicles wanes amid enthusiasm for all things AI,” said Susannah Streeter, head of money and markets at U.K. investment platform Hargreaves Lansdown.
“It is critical that Apple stays ahead of the game in developing the technology people crave in order to justify the high prices of its products. Therefore, it is important to fully explore the possibilities that AI offers for its future ranges,” she wrote in a note on Wednesday.
The iPhone maker has never confirmed long-standing speculation about making an electric vehicle, but it had made several moves over the past decade that suggested it was serious about such efforts.
Apple has been hiring automotive executives since at least 2014 and received approval from the California Department of Motor Vehicles to test self-driving vehicles in April 2017. Two years later, the company acquired Drive.ai, a self-driving car startup. And in 2021, Apple hired a BMW veteran who had led the German automaker's EV efforts.
The company also secured several automotive patents, including one for a virtual reality system to combat motion sickness and another for adjusting the tint of a window in real time.
Some experts have speculated in the past that it would be more likely that Apple would partner with one or more automakers to sell a car operating system, self-driving software or other related technology rather than produce the entire vehicle.
Tesla CEO Elon Musk claimed in 2020 that he was trying to sell the electric vehicle During a difficult period, he handed the company over to Apple, but Apple CEO Tim Cook refused to meet with him.
Also this year, analysts at Morgan Stanley said an Apple car had the potential to be “a transformative event” for the automotive and mobility industries in the coming decades, similar to how the iPhone revolutionized the mobile phone sector.
Apple may be putting its plans to enter the highly competitive electric vehicle industry on hold, but one of its biggest partners sees a big opportunity. Foxconn, maker of iPhones, is diversifying into making electric cars, with sales scheduled to begin later this year. CEO Young Liu recently told CNN that the EV business model “should be reinvented.”
This story has been updated with additional information.