VW is 'not afraid' of an Apple car

Whether or not that view holds is another story.

REUTERS/Ralph Orlowski

If Apple does go ahead with an electric car, Volkswagen won't be too worried about it. According to Reuters, VW chief Herbert Diess told Frankfurter Allgemeine Sonntagszeitung in an interview that his company was "not afraid" of an Apple car. The auto industry isn't a tech sector you can "take over at a single stroke," the CEO said. Whatever Apple brought to the table, it wouldn't dominate "overnight."

Diess said it would make sense for Apple to enter the field, as it has skill in batteries, design and software. Rumors suggest Apple is betting on a "breakthrough" battery design that would offer more range. It might be safer, too, and could be more ethical by ditching the use of cobalt (sometimes mined using child labor). LiDAR and other technologies would give it self-driving abilities.

Apple faces numerous hurdles to putting a car into production. In addition to the challenges of making an advanced EV with autonomy, it also has to line up partners if it's not going to manufacture the cars or components themselves — and Hyundai just said it's no longer talking to Apple about a team-up. The reported 2024 target is still years away, and any tech that's revolutionary now could be modest by then.

At the same time, VW might not want to get too comfortable. Remember how Palm CEO Ed Colligan said in 2006 that Apple was "not going to just walk in" to the smartphone business? And remember what happened to Palm? Apple has a history of shaking up the competitive landscape when it enters a product category. While VW certainly has a stronger position in electric cars than Palm did in phones, it might not want to assume that its position is unassailable.