titan on the horizon: the apple carcit.upc.edu/presentationcarnet/presentations/4.pdf · dr.marc...

Prof. Dr. Marc [email protected]

Mobility Business DisruptionJune 1st, 2016

Titan on the Horizon:The Apple Car

Marc SachonIESE Business School

Slide 2Prof. Dr. Marc [email protected]




Why?



Apple: A One Product Company

April to June 2015 iPhone Sales as % of Total Sales

Source: Business‐Insider, July 26th, 2015



iPhone: Commoditization

Source: Ibtimes, October 27th, 2015

Source: SpiegelOnline, May 4th, 2016



April 2015: iWatch shipped

Apple CEO Tim Cook unveils Apple iWatch at iPhone 6 event in Cupertino on September 9th, 2014



May 2016: iWatch with moderate sales

Note: “Other Products” include sales of AppleTV, Apple Watch, Beats products, iPod and Apple‐branded and third‐party accessoriesApple FY runs from end of September to end of September; Q1: Oct‐Dec, Q2: Jan‐Mar, Q3: Apr‐Jun, Q4: Jul‐Sep

Source: Apple Financials

Launch of Apple Watch

Effect of Apple Watch Launch

Effect of Apple Watchis diminishing(2016 vs. 2015)



Apple: May 2015 – May 2016

Apple

Nasdaq

Source: Apple.com, 10‐May‐16*Note: Apple had approx. 5.5 billion shares outstanding on April 8, 2016

Market Value dropped by more than

$200 Billion*



Why now?



A spiration

U rbanization



A spiration

U rbanization

T echnologyO rdinance



Pure Urban Vehicles

• Small• EV• Focus on interior design• Useability

• Sharing• Modular design• Autonomous

Source: http://www.applesfera.com



Why should we be worried?



The Asset Trap



Apple Total Net Cash

Source: Zerohedge.com

Note: Market Cap of BMW, Daimler and Volkswagen Group approx. $200 Bn



More R&D Spend on Titan than on iPhone

Source: Bloomberg, May 2016



Buying Engineering Know‐How

Source: FAZ.net, April 2016



Apple Invests $1 Bn in Didi Chuxing*

Buying Business‐Model Know‐How

*main competitor of Uber Source: Forbes, May 2016



Can this really happen?



Nokia, 2007

Source: Nokia 2007Q4 Presentation



2007: The iPhone

Source: dorotheacarney.com



Nokia vs. Apple



Apple’s Value System: iPhoneStrategy

• Closed Ecosystem:all products tie into it

• Stringent focus on customer needs(known and unknown)

• Product R&D•High quality• Plannedobsolescence

Supply Base

• 200 key suppliers• Close collaboration•Dominant customer: co‐investment in machinery of latest (and exclusive) technology, buys capacity

•High A/P: supplier financing, 90d

Volume

Assembly

•Outsourced• 18 locations (14 China, 2 USA, 1 Brazil, 1 EU)

•Dominant customer

• Low cost country•High flexibility of scale (to adapt to demand)

Data: Apple Inc., 2016

Few SKU

Power

Distribution

•Outsourced• Purchase shipping capacity in advance

•Air freight (high margin product)

Retail

•Own stores: 70% of sales volume

• Product Genius• Full IT integrationof sales staff

•Data fed to whole supply chain needs high scale flexibility

Digital Ecosystem:• Perfect integration with all Apple Products•Well established links (and power) with ICT companies

Design of User Interface / HMI:• Best‐of‐class player

Disruptive Business Models•Apple II• iPod

• iTunes• iPhone• iPad



Possible Assembers

Source: Magna, 2016; USA Today, May 9th, 2016; FAZ.NET, April 2016

Fiat Chrysler courts Google with self‐driving cars deal

Apple‐Auto soll von Magna gebaut werdenGebaut werden soll das iCar in Österreich. Der dortige Autozulieferer Magna, der dem österreichischen‐kanadischen Milliardär Frank Stronach gehört, hat durch den Wegfall der Produktion des Minis Kapazitäten in Höhe von mehreren hunderttausend Autos im Jahr.



Flextronics, 2016

Source: Flextronics Investor Presentation, April 2016



Any Indications?



$1 Billion Investment in Apple

Source: Reuters, May 2016



“Substitution, I’ve found, is the most deadly factor of all!”Andy Grove



Thank [email protected]

titan on the horizon: the apple carcit.upc.edu/presentationcarnet/presentations/4.pdf · dr.marc...

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