For Apple, with a daily growing cash pile of US$200 billion in the bank, Silicon Valley-based Tesla, with a market cap of US$24 billion, would be almost a trivial purchase, even if Apple had to pay a premium on the current price.
Tesla founder Elon Musk is renowned for founding and building up good companies and then selling them. He did it with PayPal and SpaceX and there’s no reason to think he would be averse to the idea of selling out to Apple.
In fact, many of the workers at Tesla in Palo Alto have been poached from Apple just 10 miles down the road in Cupertino. Apple has also tried to poach some workers from Tesla, without as much success.
Apple is a newcomer to the car game and is starting from a long way behind Tesla and even Google. Tesla already has the products, the knowhow and at least the beginnings of a distribution network.
Best guesses estimate that the earliest Apple could bring a car to market is 2020.
Well-to-do shareholders of Apple have recognised this and made their voices heard about Apple buying Tesla at a recent shareholders’ meeting.
While Apple CEO Tim Cook pretended to laugh off the suggestion, which was raised more than once at the meeting, speculation is now rife that his claim that Apple doesn’t have a relationship with Tesla may just be corporate politico speak.
The market for replacing gas guzzling vehicles with all-electric propulsion systems is huge and largely untapped.
Recent figures estimate that there are 1 billion internal combustion engine automobiles on the road globally, plus another 250 million or so larger transport vehicles. Approximately 60 million cars are produced annually.
Mainly four countries mine lithium, the power storage source of electric vehicles and most electronics devices. Chile and Australia are by far the two largest producers, followed by China and Argentina.