Do you remember a couple of months ago when a bizarre rumor emerged about Apple (NASDAQ:AAPL) and super-secretive Silicon Valley electric car start-up Faraday Future?
Specifically, the idea was that Apple could be using Faraday Future as a front, kind of like a shell company, to veil its buildup of critical manufacturing infrastructure. The two companies' shared emphasis on secrecy is a common trait, and both are expected to challenge Tesla Motors (NASDAQ:TSLA) in the near future. Faraday Future also had a mysterious source of funding, as it plans on building a $1 billion manufacturing facility in Nevada. That's but a tiny dent in Apple's cash position.
But beyond these shallow commonalities, this rumor really never made sense to begin with. And now that Faraday Future has unveiled what it's up to, the idea looks even sillier.
This is about as un-Apple as it gets
At the Consumer Electronics Show in Las Vegas earlier this week, Faraday Future hosted its first unveiling event for its electric concept car. The FFZERO1 concept's "projected specifications" included over 1,000 horsepower and a 0-60 mph time of less than 3 seconds. Oh, and it only seats one person. The car itself is quite over the top and unrealistic.
Faraday Future is working on a Variable Platform Architecture, or VPA, that utilizes modular components with the hopes of accelerating development time frames for a wide category of electric vehicles. The Batmobile-looking thing is just an example of a type of car that could be possible on the company's VPA. Faraday Future says it will have real cars to show off in a couple of years.
But the presentation was poorly delivered and the company raised more questions than it answered. Faraday Future made a wide range of hyperbolic claims about how it would revolutionize the auto industry, including a direct comparison of itself to the iPhone in 2007. We're talking about statements like "We need to define the future from the future's perspective," and that the company is working on "nothing less than a complete rethink of what mobility means." Yet it didn't provide any real detail or tangible strategy or model.
Now, Apple is no stranger to hyperbole, but at least when Apple makes a bold claim it at least attempts to back it up with some type of evidence or new product or feature. And Apple would never host an event years in advance to show off an unfinished product.
At the same time, the identity of Faraday Future's backers was also revealed: China's LEtv. LEtv is an online media streaming company in China, often referred to as the "Netflix of China," and they have created an automotive division to partner with Faraday Future. LEtv will help Faraday Future find additional investors as well as help enter the important Chinese auto market. It will also help build up connectivity infrastructure and content to integrate with a future electric vehicle made by Faraday Future.
He didn't say no
Now, none of this is to say that Apple isn't working on an electric vehicle. There's way too much evidence that suggests it is. The most recent clue was on a 60 Minutes segment on Apple that aired last month. When asked point blank whether or not Apple would ever enter the car market, Tim Cook was rather coy.
I mean, seriously, look at this guy:
Clearly, Apple is up to something, and it most certainly is not (and never could have been) Faraday Future.
Evan Niu, CFA owns shares of Apple, Netflix, and Tesla Motors. The Motley Fool owns shares of and recommends Apple, Netflix, and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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