By Aaron Tilley
Apple has put an end to its decadelong push to build its own electric vehicle, an effort once seen as having the potential to transform the auto industry.
That transformation, which has been under way for years, continuously increased the level of difficulty Apple faced as it spent billions trying to catch or exceed the capabilities made available during a revolution led by Tesla Motors.
The secret group inside the iPhone giant — known internally as Project Titan — has been informed that Apple would be shutting down its efforts in building a car while the company ramps up investments in the area of generative artificial intelligence, a person familiar with the situation said.
Some of the employees inside the group will be shifting to Apple’s AI group, while other employees working on car hardware will likely face layoffs. Bloomberg News earlier reported the plans.
Apple has spent billions of dollars on research and development on the car project. The car group inside Apple was the subject of several rounds of restructuring and shifting strategies over the years as Apple struggled to figure out a path forward, people who worked on the project said. Some executives pitched deep partnerships with automakers or even outright buying an automaker, but none of that materialized, the people said.
As Apple’s car project progressed, the company’s goals around autonomous driving capabilities wavered. When the effort kicked off around 2014, the company imagined a fully autonomous vehicle. Over time, Apple scaled back those ambitions to semiautonomous, where the vehicle automates only some parts of the driving.
With these strategic changes, leadership was also in near constant flux. Doug Field, a former Tesla executive, led the project between 2018 and 2021 before departing for Ford. Kevin Lynch, who previously was responsible for the Apple Watch, had been leading Titan up until its cancellation.
“Apple canceling this project is a sigh of relief for us,” said Dan Morgan, a senior portfolio manager at Apple shareholder Synovus Trust. “When you looked at Apple’s future initiatives, the car project was always the most far-fetched for Apple. This just isn’t in their wheelhouse.”
Instead, it is better Apple will be redeploying engineers and investments into areas like artificial intelligence that could help its consumer electronics business, Morgan said.
Apple’s AI efforts are being directed by John Giannandrea, a former Google executive who joined the company in 2018. Some of Titan’s employees will move under Giannandrea, who has been working on the underlying technology for generative artificial intelligence.
Apple Chief Executive Tim Cook told investors earlier this month that the company has been working on generative AI and was planning to announce progress later this year. “We’ve got some things that we’re incredibly excited about that we’ll be talking about later this year,” he said on the call with analysts.
Generative AI has consumed the tech industry with the release of OpenAI’s ChatGPT, a chatbot powered by so-called large language models that is capable of responding to queries in humanlike ways.
Project Titan began under Cook’s tenure after he took over as CEO from co-founder Steve Jobs in 2011. It offered one pathway forward as the company sought out new opportunities beyond the iPhone, which continues to dominate the company’s overall revenue.
This year, Apple released another long-gestating project with the Vision Pro, its virtual reality headset that can place digital objects in real-world environments.
Write to Aaron Tilley at aaron.tilley@wsj.com