Talks are on for Lit Motors, an electric motorbike startup to be bought by Apple even as the tech giant is seeking a stake in luxury carmaker McLaren in order to ramp up efforts to disrupt the transportation industry, several sources were quoted in the media as saying.
One of the sources reportedly told media that rather than outright buying, a large investment in U.K.-based McLaren would be made by the technology giant. Since the San Francisco startup has several international self-driving patents, it wants to acquire Lit Motors. The person said that a Lit deal is being actively pushed by BMW, Audi and a South Korean automaker.
Apple has been targeting a release of its car as soon as 2020 and it has hundreds of engineers working on car design as the company is eager for a new hit to replace the iPhone. While it has never abandoned efforts to build its own vehicle or tie up with an established carmaker, the company has been focusing more on self-driving software in recent months, people familiar with Apple’s thinking said. McLaren would bring brand strength, advanced engineering and a portfolio of patents to the equation with its sports cars starting at almost $200,000.
Reports that Apple was considering taking a stake in the U.K.-based carmaker or buying all of McLarenm had appeared in The Financial Times earlier. Apple’s talks with Lit Motors were reported by The New York Times earlier.
McLaren denied it was negotiating with Apple. “I can confirm that McLaren is not in discussion with Apple about any potential investment,” Michael Flewitt, chief executive officer of the automotive unit, said in a text to the media. Apple and Lit Motors declined to comment.
Apple would do more acquisitions and strategic investments, its Chief Executive Officer Tim Cook suggested in a call with analysts earlier this year. Cook told investors in July that Apple had $232 billion in cash at the end of June, about $215 billion of that is kept outside of the U.S.
Tesla Motors Inc., deemed a good fit because it sells electric cars with self-driving capabilities, was speculated by many analysts to be bought by Apple.
Since the U.K. company is best known for luxury cars that go very fast, buying a stake in McLaren is less obvious. And mass-manufacturing capabilities is absent in the company. Compared with mainstream automakers with several factories each cranking out hundreds of thousands of autos each year, McLaren can make only a few thousand cars a year.
Acquiring McLaren would be a “strange move” for Apple, said Dominic O’Brien, a London-based analyst at Exane BNP Paribas.
“They wouldn’t gain manufacturing scale or much know-how about mass-produced cars,” he said. “McLaren isn’t known for electric cars or its autonomous driving capability,” O’Brien said.
Bahrain Mumtalakat Holding Co., the investment arm of the kingdom of Bahrain, owns more than 55 percent of the closely held McLaren. McLaren Chairman Ron Dennis, with 10 percent and TAG Group Ltd., a Luxembourg-based holding company, with 11 percent are the next two biggest shareholders.
(Adapted from Bloomberg)