Apple cancels work on electric car project, reports say

Apple has abandoned decade-long efforts to build an electric car, according to multiple media reports, calling time on a project that some saw as potentially transformative for the auto industry.

Many employees working on the project, known internally as "Project Titan," will be moved to the company's artificial intelligence division, according to Bloomberg, which first reported the decision citing people with knowledge of the matter. CNN has contacted Apple (AAPL) for comment.

The news comes as electric vehicle (EV) sales have disappointed, prompting several major carmakers to pull back on investments and slash prices. AI, on the other hand, is having a moment and Apple's reported shift in resources could help it close the gap with rivals such as Microsoft and Google, which have stolen a march on the breakthrough technology.

"The tech giant is following a trend, with investors' enthusiasm for electric vehicle investments waning, amid the frenzy for all things AI," said Susannah Streeter, head of money and markets at UK-based investing platform Hargreaves Lansdown.

"It's vital that Apple stays one step ahead in developing the tech people crave, to justify its products' high price points, so fully exploring the opportunities AI presents for its future ranges is essential," she wrote in a note Wednesday.

'Transformative' for the auto industry

The iPhone maker never confirmed long-running speculation that it would make an EV, but had taken several steps over the past 10 years that suggested it was serious about such efforts.

Apple had been hiring automotive executives since at least 2014 and, in April 2017, it received a permit from the California Department of Motor Vehicles to test self-driving vehicles. Two years later, it acquired Drive.ai, a self-driving car startup. And in 2021, Apple hired a BMW veteran who had steered the German carmaker's EV efforts.

It also secured several car-related patents, including one for a virtual reality system to address motion sickness, and another for adjusting the tint on a window in real time.

Some experts have in the past speculated that it was more likely Apple would partner with one or multiple carmakers to sell a car operating system, self-driving software or other related technology, rather than making the entire vehicle.

Tesla CEO Elon Musk claimed in 2020 that he had attempted to sell the EV company to Apple during a rough patch but that Apple CEO Tim Cook refused to meet with him.

Also that year, Morgan Stanley analysts said an Apple car had the potential to be "a transformative event" for the automobile and mobility industries in the coming decades, much as the iPhone disrupted the mobile phone sector.

Apple may be shelving plans to break into the highly competitive EV industry, but one of its largest partners sees a major opportunity. Foxconn, which manufactures iPhones, is diversifying into making electric cars, with sales due to start this year. CEO Young Liu recently told CNN that the EV business model "should be reinvented."

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