Apple has given up on the dangers and opportunities that car building brings to China

Mondo Cars Updated on 2024-03-07

Not long ago, Apple officially announced that it had abandoned a decade-long plan to build a car. The news may come as a surprise to many, given Apple's success in smartphones has led to high expectations for its foray into the automotive industry. However, it turns out that even tech giants like Apple are inevitably experiencing difficulties and setbacks when entering new territory.

There are two reasons for the failure of Apple's car-building program, both internally and externally. From an internal point of view, Apple's brilliant achievements in the smartphone era have instead become a shackle to its further development. With a gross profit margin of more than 45% and a net profit margin of more than 30%, Apple has to face tremendous pressure when entering new areas. Investors expect Apple to replicate its success in the mobile phone sector and maintain high profit levels, which is undoubtedly a huge challenge for the highly competitive auto industry. In the field of smart phones, Apple, with its monopoly right to speak, can exert huge pressure on the best merchants and squeeze profit margins. However, in the automotive industry chain, the voice of the core business is much stronger. Power battery giants like CATL have even made many automakers have to look at their faces. If Apple wants to achieve high profits in the field of car manufacturing, it is bound to significantly reduce the **business**, but this is almost impossible to achieve in reality.

From the perspective of the external environment, the energy crisis triggered by the Russia-Ukraine conflict has caused a subtle change in Europe's attitude towards the transition to electrification. The manufacturing industry in countries such as Germany has shrunk severely, and it has become a top priority to preserve jobs. In this case, environmental concerns had to give way. The EU's plan to ban the sale of gasoline-powered vehicles by 2035 is also at risk of being put on hold. In the United States, Trump and others have publicly stated that they will support fuel vehicles and crack down on the development of electric vehicles. All of this makes the future of companies like Apple who want to build electric cars worrying. Although the demand for electric vehicles in the Chinese market is strong, the competition is also extremely fierce. Without deep binding to China's industrial chain, it is difficult for Apple to get a share of this red sea. In recent years, the United States has been promoting the de-sinicization of the ** chain, and Apple's increase in the proportion of Chinese parts is undoubtedly contrary to its established strategy. The combination of various factors contributed to the ultimate failure of Apple's car-building plan.

Apple's story is a wake-up call for China's auto industry. The vacillation of Europe and the United States on the issue of carbon neutrality may upset the market for new energy vehicles. To avoid a repeat of Japan's hydrogen vehicles, China needs to plan ahead. On the one hand, it is necessary to hold on to key companies such as Tesla and Volkswagen, and on the other hand, it is also necessary to moderately slow down the process of electrification, maintain a balance between electric, hybrid, fuel and other technical routes, and avoid fighting alone. The collapse of Apple's dream of building a car is, in the final analysis, the inevitable result of the disparity in the strength of the automobile and even manufacturing industries between China and the United States. As consumers, we may regret not having the opportunity to see Apple's products"iphone car"But it also reminds us that the change of any industry is not achieved overnight, and we need to be down-to-earth, adapt to the times, and take precautions to build a long-lasting business.

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