The car makers are to use more software as demand for hybrid cars increases.
Whether Apple is able to develop cars or not is a different question. But it has certainly made inroads into the vehicle industry. This year at the Frankfurt Motor Show connectivity replaced horsepower as the buzzword.
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The talk at this year’s auto show is of self-driving cars and battery-powered cars. We all know that Apple and Google are not even close to mass-producing a vehicle. Yet their intentions seem to be headed in the same direction.
Apple and Google have technology expertise that these car makers simply cannot match. These Silicon Valley companies also have financial resources that are much greater than some of the carmakers. Google started working on self-driving cars in 2009.
Today Google is valued by the stock market at more than five times the worth of some car makers. Apple is worth eight times as much, according to NYTimes. This financial position gives them an advantage. This is because the car-making business is one that requires huge investments.
The major risk to carmakers is not that Apple will destroy Mercedes-Benz (or BMW) like it did in the case of Nokia. Rather the fear is that these carmakers will be turned into merely run-of-the-mill hardware manufacturers.
This means Apple would rake in all the profits. That is why carmakers maintain that they will resist this danger. The carmakers will do this by exercising firm control regarding the software that is inside the vehicles.
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As carmakers are under constant pressure to make environmentally friendly cars, they will need new software. Here they will need Apple or Google. And it will be interesting to see how it all pans out.