We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Apple Inc. (AAPL - Free Report) has decided to cancel its ambitious project to build an electric car, marking the end of a decade-long effort that aimed to revolutionize the automotive industry. The decision was disclosed internally on Feb 27, 2024, surprising the nearly 2,000 employees dedicated to the project, per Bloomberg.
Chief Operating Officer Jeff Williams and Vice President Kevin Lynch informed the team that the project, known as Project Titan, would begin winding down. The decision to cancel the project reflects challenges in the electric vehicle market, including slowing sales growth and competition. Other automakers are pivoting to hybrid vehicles, and Tesla has warned of slower expansion.
Shift to Artificial Intelligence Division
By not entering the automotive manufacturing industry, Apple can further develop its CarPlay software, enhancing integration with vehicle controls and entertainment systems. Focusing on AI aligns with long-term profitability potential. Many employees from the car team will be transitioned to Apple's artificial intelligence division, led by executive John Giannandrea. They will focus on generative AI projects.
Potential Growth of AI Market
Generative artificial intelligence is expected to deliver at least $6.1 trillion in incremental value to the global economy annually, according to McKinsey & Company. Artificial intelligence (AI) continues to revolutionize the broader industry. About 177 companies within the S&P 500 cited “AI” during their last quarterly earnings call, per the factsheet of Themes ETFs (read: A New Artificial Intelligence ETF (WISE - Free Report) Hits the Market).
Relief for Investors
Investors reacted positively to the news, with Apple's stock climbing after the announcement. Apple shares were up 0.8% on Feb 27, and added 0.2% after hours. The decision relieved concerns and signaled a strategic shift for the company.
End of Multibillion-Dollar Effort
Project Titan aimed to develop a fully autonomous electric vehicle with advanced features. Despite significant investment, the project faced challenges from the outset, including leadership changes and strategic shifts.
Apple's most senior executives finalized the decision after considering various options, including delaying the car release and adjusting self-driving specifications. Concerns about profitability and continued investment influenced the outcome.
Focus on Other Innovations
While abandoning the electric car project, Apple remains committed to innovation in other areas. The company continues to invest heavily in research and development, recently launching new products like the Vision Pro headset.
Impact on CarPlay and AI Development
By not entering the automotive manufacturing industry, Apple can further develop its CarPlay software, enhancing integration with vehicle controls and entertainment systems. Focusing on AI aligns with long-term profitability potential.
ETFs in Focus
Against this backdrop, below we highlight a few AI ETFs that could be tapped in the current scenario. This is especially important given the recent in AI initiatives by various technology players (read: Guide to Artificial Intelligence ETFs).
ROBO Global Robotics and Automation Index ETF (ROBO - Free Report)
The underlying ROBO Global Robotics and Automation Index measures the performance of companies which derive a portion of revenues and profits from robotics-related or automation-related products or services. The fund charges 95 bps in fees.
Global X Robotics & Artificial Intelligence ETF (BOTZ - Free Report)
The underlying Indxx Global Robotics & Artificial Intelligence Thematic Index invests in companies that potentially stand to benefit from increased adoption and utilization of robotics and artificial intelligence, including those involved with industrial robotics and automation, non-industrial robots, and autonomous vehicles. The fund charges 69 bps in fees.
The underlying NYSE FactSet Global Robotics and Artificial Intelligence Index is composed of equity securities of companies primarily listed in one of 43 developed or emerging market countries that are the most involved in, or exposed to, one of the 22 robotics and artificial intelligence-related FactSet Revere Business Industry Classification Systems. The fund charges 47 bps in fees.
First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT - Free Report)
The underlying Nasdaq CTA Artificial Intelligence and Robotics Index is designed to track the performance of companies engaged in Artificial intelligence, robotics and automation. The fund charges 65 bps in fees.
The underlying Solactive Generative Artificial Intelligence Index identifies 40 companies that derive their revenues from either Artificial Intelligence, Data Analytics & Big Data, Natural Language Processing and Artificial Intelligence-Driven Services. The fund charges 35 bps in fees.
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Apple Dumps EV for AI: Play AI ETFs
Apple Inc. (AAPL - Free Report) has decided to cancel its ambitious project to build an electric car, marking the end of a decade-long effort that aimed to revolutionize the automotive industry. The decision was disclosed internally on Feb 27, 2024, surprising the nearly 2,000 employees dedicated to the project, per Bloomberg.
Chief Operating Officer Jeff Williams and Vice President Kevin Lynch informed the team that the project, known as Project Titan, would begin winding down. The decision to cancel the project reflects challenges in the electric vehicle market, including slowing sales growth and competition. Other automakers are pivoting to hybrid vehicles, and Tesla has warned of slower expansion.
Shift to Artificial Intelligence Division
By not entering the automotive manufacturing industry, Apple can further develop its CarPlay software, enhancing integration with vehicle controls and entertainment systems. Focusing on AI aligns with long-term profitability potential. Many employees from the car team will be transitioned to Apple's artificial intelligence division, led by executive John Giannandrea. They will focus on generative AI projects.
Potential Growth of AI Market
Generative artificial intelligence is expected to deliver at least $6.1 trillion in incremental value to the global economy annually, according to McKinsey & Company. Artificial intelligence (AI) continues to revolutionize the broader industry. About 177 companies within the S&P 500 cited “AI” during their last quarterly earnings call, per the factsheet of Themes ETFs (read: A New Artificial Intelligence ETF (WISE - Free Report) Hits the Market).
Relief for Investors
Investors reacted positively to the news, with Apple's stock climbing after the announcement. Apple shares were up 0.8% on Feb 27, and added 0.2% after hours. The decision relieved concerns and signaled a strategic shift for the company.
End of Multibillion-Dollar Effort
Project Titan aimed to develop a fully autonomous electric vehicle with advanced features. Despite significant investment, the project faced challenges from the outset, including leadership changes and strategic shifts.
Apple's most senior executives finalized the decision after considering various options, including delaying the car release and adjusting self-driving specifications. Concerns about profitability and continued investment influenced the outcome.
Focus on Other Innovations
While abandoning the electric car project, Apple remains committed to innovation in other areas. The company continues to invest heavily in research and development, recently launching new products like the Vision Pro headset.
Impact on CarPlay and AI Development
By not entering the automotive manufacturing industry, Apple can further develop its CarPlay software, enhancing integration with vehicle controls and entertainment systems. Focusing on AI aligns with long-term profitability potential.
ETFs in Focus
Against this backdrop, below we highlight a few AI ETFs that could be tapped in the current scenario. This is especially important given the recent in AI initiatives by various technology players (read: Guide to Artificial Intelligence ETFs).
ROBO Global Robotics and Automation Index ETF (ROBO - Free Report)
The underlying ROBO Global Robotics and Automation Index measures the performance of companies which derive a portion of revenues and profits from robotics-related or automation-related products or services. The fund charges 95 bps in fees.
Global X Robotics & Artificial Intelligence ETF (BOTZ - Free Report)
The underlying Indxx Global Robotics & Artificial Intelligence Thematic Index invests in companies that potentially stand to benefit from increased adoption and utilization of robotics and artificial intelligence, including those involved with industrial robotics and automation, non-industrial robots, and autonomous vehicles. The fund charges 69 bps in fees.
iShares Robotics And Artificial Intelligence Multisector ETF (IRBO - Free Report)
The underlying NYSE FactSet Global Robotics and Artificial Intelligence Index is composed of equity securities of companies primarily listed in one of 43 developed or emerging market countries that are the most involved in, or exposed to, one of the 22 robotics and artificial intelligence-related FactSet Revere Business Industry Classification Systems. The fund charges 47 bps in fees.
First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT - Free Report)
The underlying Nasdaq CTA Artificial Intelligence and Robotics Index is designed to track the performance of companies engaged in Artificial intelligence, robotics and automation. The fund charges 65 bps in fees.
Themes Generative Artificial Intelligence ETF (WISE - Free Report)
The underlying Solactive Generative Artificial Intelligence Index identifies 40 companies that derive their revenues from either Artificial Intelligence, Data Analytics & Big Data, Natural Language Processing and Artificial Intelligence-Driven Services. The fund charges 35 bps in fees.
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)