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Apple's Rumored Drive.ai Buyout to Aid Driverless Car Project

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Apple’s (AAPL - Free Report) driverless car initiative, Project Titan, has been a subject of intense speculation due to the classified nature of the project. The company is now rumored to buy a self-driving shuttle firm, Drive.ai, which is likely to boost its driverless car initiative.

Per Information, the “acqui-hire” can “result in dozens of Drive.ai engineers ending up at Apple.” According to engadget, Drive.ai had approximately 100 engineers as of February 2019.

The deal, if happens, will definitely boost Apple’s engineering talent strength, owing to Drive.ai engineer’s domain expertise in neural networks, which play an important role in developing software for driverless vehicles.

Moreover, per Dallas Business Journal, the start-up has completed driverless pilot projects in Arlington and Frisco. Drive.ai conducted 760 trips serving 1,419 passengers, logging more than 440 miles in autonomous mode without any incident between Aug 22, 2018, and May 6, 2019.

Hence, Drive.ai will also provide Apple a solid database related to road conditions, signals and traffic, which the shuttles had to encounter during trips. This data helps developers to improve software for driverless vehicles to smoothly navigate through roads and traffic in the future.
 

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Apple Inc. Revenue (TTM)

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Project Titan – EV cars, Low Cost Lidars & Testing

Speculations have been rife over the iPhone-maker’s ultimate goal with its Project Titan. It is well-understood that the company is no more into building its own car and just focused on developing driverless vehicle software. It has also been rumored that the company is currently working on an electric van (EV).

Notably, Apple hired Michael Schwekutsch, Tesla’s (TSLA - Free Report) head of electric powertrains, which further suggested a probable electric car focus. The company has also hired executives from Fiat, Mercedes, Ford and other car-makers.

Further, the company is planning to develop a lidar solution that not only provides a three-dimensional look at the road but can also be manufactured at a lower cost using conventional semiconductor manufacturing techniques.

Per Reuters, Apple’s plan “has the potential to lower prices from the many thousands to the hundreds of dollars as the sensors are produced in larger numbers, similar to chips in phones and other devices.”

Additionally, the company has become aggressive in testing its cars over the last couple of years. It has disclosed that its vehicles collectively drove almost 80,000 miles on California public roads over the 2017-2018 period.

In February, Apple filed a self-driving car disengagement report with the California DMV. Per the filing, the company logged 871.65 disengagements (the number of times a human driver has to take over control of an ADS) per 1,000 miles, making it 1.1 miles per disengagement.

Nevertheless, Apple is quite late in the driverless vehicle space compared with the likes of Alphabet (GOOGL - Free Report) division Waymo, Tesla and Uber (UBER - Free Report) . The company is now expected to launch its driverless EV/car in 2021.

Currently, Apple has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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