Why Apple Needs to Buy Out Tesla (Immediately)
If there were ever a perfect time for Apple to acquire Tesla Motors, that time might be now.
The Elon Musk-headed auto manufacturer has hit a rough spot in recent months. For one, that’s the result of a now-defunct plan to take the company private, as well as some other factors and controversies. Tesla’s stock has taken a hit, and most analysts believe the company is running out of available cash quickly.
Over the last few years, rumors have swirled about Apple considering buying Tesla — or at least acquiring a majority stake in the electric car maker. And while it’s still a long shot, it’s might just be an inherently good idea.
Apple has long been rumored to be working on its own self-driving car, which hints at larger ambitions about moving into the automotive industry. But progress on that front has been slow.
Buying Tesla would give Apple a distinct advantage and head start in the automobile industry, with the former company’s technology and expertise. And, on the other hand, it would give Musk and Tesla a boost in production and operations.
Not to mention that Apple could benefit greatly from Tesla’s Gigafactory plans, as Wired pointed out in a 2014 piece.
And as erratic as Musk’s behavior has been in recent months, there’s still no doubt that the CEO has some visionary ideas. And those ideas do line up with some of Apple’s own values.
Both companies have similar ideals and plans in terms of sustainability and green technology. Tesla wants to kickstart the solar and electric car revolution, while Apple has long been a pioneer in running a global technology firm sustainably.
Apple is already the world’s most valuable company as far as market valuation, and it undoubtedly has a bit of cash to burn.
While some analysts have downplayed the idea that Apple will acquire or merge with Tesla, they still admit that it could be a good move on the Cupertino tech giant’s part.
Loup Ventures’ Gene Munster wrote in a Monday blog post that, if Tesla reaches profitability within a year, then a merger is a “fairy tale.” But Munster added that if it doesn’t, “Apple gains the upper hand and becomes the most likely investor or buyer.”
Ross Gerber, CEO of investment management firm Gerber Kawasaki, told CNBC that Tesla’s plummeting market value is a “gift” to Apple CEO Tim Cook — and added that not buying Tesla could be the “biggest mistake” of Cook’s career.
Of course, Musk likely won’t leave Tesla voluntarily. And his erratic behavior and personality may cause problems with the much-more straight laced culture at Apple.
Still, both Apple and Tesla would benefit from such a merger. So the real question is not if it’s a good idea, but whether it will actually happen.
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