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Tesla executed an Apple tactic to leave them ‘way behind’ in self-driving: ARK Investment

Estimated reading time: 3 minutes

According to ARK Investment Management CEO Cathie Wood, Tesla took a page out of Apple’s book in terms of designing its own self-driving chip. As a result, the future Apple’s self-driving car is well behind before it has really even begun.

“Tesla took a leaf out of Apple’s book when it developed its own chip for autonomous vehicles,” Wood said in a webinar on Tuesday. In the past, Apple has entered markets that have been saturated with revolutionary tech until the company took things a step further and developed something groundbreaking. “Apple has entered markets well after someone else has established them and run away with the market,” Wood added, which is remarkable and factual in every way.

Apple officially called on TSMC, a manufacturing entity of microprocessors, to create a capable self-driving chip for its vehicle. But the question goes beyond whether it will be effective.

The question is not whether Apple will make a breakthrough with a self-driving vehicle, but when. During this decade, it has plans to build a fully autonomous electric vehicle. Reports suggest that between 2025 and 2027 it could be available to the market. But Apple is entering a whole new ballgame, and vehicles are a lot different than tablets. While there are some parallels now, such as Over-the-Air upgrades and complexity of apps, Apple does not deal with businesses that make small improvements in this field of already established products. In EVs and self-driving, Tesla is the absolute pioneer and Apple plans to catch up.

Apple may have a tough time, however, because Tesla has built its own wave of self-driving infrastructure. Tesla uses a camera-based option that has been widely popular, instead of going with LiDAR systems that use light, reflections, and sensors. Only look at its FSD Beta, which since its launch in October has improved tremendously.

To prove that it’s going to be the top dog, Tesla has the expertise, data, and miles, and it’s going to be hard to knock them off the pedestal. In May, Tesla had driven more than 3 billion miles on Autopilot, and Wood says the company is coming up with 20 billion real-world miles. According to Finding Alpha, Google only has between 20 million and 50 million, she said.

It’s not that Apple may not be able to overcome the self-driving problems, since fellow ARK analyst Tasha Keeney thinks the company is making the right moves. Keeney said that it was a smart decision for Apple to decide to place its Artificial Intelligence head on the project, but the timing is just off.

“This is an AI game, the problem is Apple just did it,” Wood added. “They are way behind.”

ARK has a price target of $7,000 per share for TSLA by 2024.

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