Apple just received a permit from the California Department of Motor Vehicles to allow the company to test drive vehicles on California public roads using its own autonomous driving technology.
Apple is by no means the first company to get this permission from the California DMV. In fact, it's not even in the first 10 to receive permission to test drive on public roads in California. It is actually the 30th company to receive the DMV's blessing to test drive autonomous vehicles on public roads in California.
Companies that have received permission before Apple include well-known firms in autonomous tech, such as Volkswagen (the first to receive permission from the California DMV), Mercedes Benz, Google, Tesla, Nissan, BMW, Honda, Ford, Baidu, Nvidia, et al, and also includes a few not-yet household names, such as Zoox, Inc., Valeo N.A., NextEV USA, Inc., Udacity, Inc. and Nuro, Inc., among others.
The permit issued to Apple allows the company to test its autonomous driving technology equipped in 3 Lexus SUVs, along with six human drivers on California's public roads.
According to a study by Deloitte, there is almost $2 trillion in annual revenues tied to the auto business in the U.S. alone. So, with a pie that is so incredibly big, there is absolutely no doubt why companies are investing in the space, with Apple being no exception.
While Apple remains secretive on its plans and CapEx in the space, it's widely known that Ford is spending at least $1 billion per year to achieve its target of getting a self-driving car on the market by 2021, while GM has publicly stated that it is spending about $600 million or so per year on its own self-driving initiatives. BMW has teamed up with Intel to bring out a self-driving car and Google's Waymo unit has already logged 2.5 million miles developing its own autonomous tech.
As it always is with Apple, there is chatter that the company has been working on self-driving technology (Project Titan) for years, although the company itself only first publicly acknowledged its involvement this past November in a letter to the NHTSA offering its knowledge/input on potential government regulations regarding the automated vehicle space.
While there is a lot of speculation as to whether Apple is working on an entire autonomous vehicle or just on the software that would control an autonomous vehicle, the company remains mum on its plans.
From my perspective, developing the software and then licensing it out to OEMs (automakers) around the world would save Apple a lot of headaches, not to mention reduce the massive amount of investment associated with adding car manufacturing to its line-up. On the flip side, offering consumers both the software (brains or autonomous driving technology) and the hardware (the car itself) would be hugely more rewarding to the company and its shareholders once the product is on the market.
More importantly, its not like Apple does not have the cash lying around, no? Especially if President Trump's repatriation plans are pushed through at some point.
Apple remains as tight-lipped as ever about its plans regarding autonomous driving technology, however, a DMV license to use public roads comes along with rules and regulations that require filing of public reports regarding the company's efforts in the space.
So, we could be hearing a lot more about what exactly Apple is doing in the space going forward. Of course, Apple has probably considered the DMV requirement before applying for the permit and more than likely felt that the additional disclosures required would be worth it at this point.
Shares of Apple closed on Thursday at $141.05 per share, down $0.75 on the day.
(Long aapl, bidu, googl, tsla, long and short options in all 4)