Behind Apple's doomed car project: False starts and wrong turns

Brian X Chen & Tripp Mickle

For the last decade, many Apple employees working on the company’s secretive car project, internally code-named Titan, had a less flattering name for it: the Titanic disaster. They knew the project was likely to fail.

Throughout its existence, the car effort was scrapped and rebooted several times, shedding hundreds of workers along the way. As a result of dueling views among leaders about what an Apple car should be, it began as an electric vehicle that would compete against Tesla and morphed into a self-driving car to rival Google’s Waymo.

By the time of its death — Tuesday, when executives announced internally that the project was being killed and that many members of the team were being reassigned to work on artificial intelligence — Apple had burned more than $10 billion on the project and the car had reverted to its beginnings as an electric vehicle with driving-assistance features rivaling Tesla’s, according to a half dozen people who worked on the project over the past decade.

The car project’s demise was a testament to the way Apple has struggled to develop new products in the years since Steve Jobs’s death in 2011. The effort had four different leaders and conducted multiple rounds of layoffs. But it festered and ultimately fizzled in large part because developing the software and algorithms for a car with autonomous driving features proved too difficult.Apple declined to comment. When Apple launched its car project in 2014, it was among a stampede of investors, executives, engineers and companies chasing the idea of a self-driving car. After Google began testing prototypes on public roads in California, voices across Silicon Valley insisted that autonomous vehicles would soon be commonplace. Apple didn’t want to be left behind.

At the time, the company was dealing with questions from its top engineers about its next project. Tim Cook, Apple’s chief executive, approved the project in part to prevent an exodus of engineers to Tesla.

Cars were part of a $2 trillion transportation industry that could help Apple, which by then was a nearly $200 billion business.

Despite having a vote of confidence from Apple’s chief executive, members of the team knew they were working against harsh realities, according to the six employees familiar with the project. If it ever came to market, an Apple car was likely to cost at least $100,000 and still generate razor-thin profit compared with smartphones and earbuds. It would also arrive years after Tesla had dominated the market.

The company held some discussions with Elon Musk about acquiring Tesla, according to two people familiar with the talks. But ultimately, it decided that building its own car made more sense than buying and integrating another business. Musk did not respond to a request for comment.

From its inception, the project was troubled by differing views on what it should be, the people familiar with it said. Steve Zadesky, who initially led the effort, wanted to build an electric vehicle that competed with Tesla. Jony Ive, Apple’s chief design officer, wanted to pursue a self-driving car, which members of the software team said could be done.

Apple, which by then had $155 billion in cash, spent lavishly to hire hundreds of people with experience in machine learning, a type of AI technology, and other capabilities crucial to making a self-driving car.

The car team, composed of more than 2,000 employees by this year, included engineers who had worked for NASA and developed racecars for Porsche.

Designers drew concepts for a car that would look like a European minivan such as the Fiat Multipla 600, which has a half-dozen windows and a curving roof.

But by 2016, it was clear that the car effort was in trouble. Zadesky left Apple, and his successor, Mansfield, told the team working on the project that they would be shifting their focus from building a car to building self-driving car software, said three people familiar with the shift. Apple secured permits from California to begin test-driving Lexus sport utility vehicles outfitted with sensors and computers.  Apple’s dead car project will be survived by its underlying technologies.

The company plans to take what it has learned about artificial intelligence and automation and apply it to other technologies that are being researched, including AI-powered AirPods with cameras, robot assistants and augmented reality, according to three people briefed on the projects. Though the engineers working on automation software will get to work on artificial intelligence projects, others on the car team have been told they will need to apply for different roles at the company.

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