Apple Cancels Car Plans, Shifts Employees to AI Division

Apple has reportedly told employees that it is canceling its effort to build an electric car and is shifting many members from the car team to its artificial intelligence (AI) division.

The decision was shared with nearly 2,000 employees working on the project in an internal announcement by Chief Operating Officer Jeff Williams and VP Technology Kevin Lynch, who oversees the car effort, Bloomberg reported Tuesday (Feb. 27), citing unnamed sources.

Apple did not immediately reply to PYMNTS’ request for comment.

The decade-long, multibillion-dollar effort to build an electric car, known as Project Titan, will be winding down, with many employees from the car team, known as Special Products Group (SPG), being shifted to Apple’s AI division to focus on generative AI projects, according to the report. There will be layoffs, but the number has not been disclosed.

This news comes as a relief to investors, with the company’s stock gaining about 0.5% following the posting of the news by Bloomberg, the report said.

Apple began working on a car in 2014, aiming for a fully autonomous electric vehicle with advanced features, per the report.

However, the project faced numerous challenges from the beginning, with changes in leadership and strategy over the years, according to the report.

The decision to wind down the project was finalized by Apple’s most senior executives in recent weeks, following concerns about profitability and the substantial investment required for the project, the report said.

Apple continues to invest heavily in research and development (R&D) in other areas, per the report. The company recently launched its Vision Pro mixed-reality headset, its first new product category in almost a decade.

It was reported in January that Apple had scaled back and delayed its plans to develop a vehicle. The company shifted its focus from a fully autonomous vehicle to an electric vehicle with more limited features and pushed the projected release date two more years into the future, to 2028, Bloomberg reported on Jan. 23.

At the same time, Apple is reportedly investing $1 billion per year to integrate generative AI across its product line. The company aims to bring this technology to its full range of products.