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But Why Would Apple Want To Buy Tesla?

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Elon Musk says he tried to sell Tesla to Apple. Well, OK:

Elon Musk offered to sell Tesla to Apple but was turned down by Tim Cook, who refused to take a meeting, the electric car maker’s chief executive has claimed.

Rather wise of Mr. Cook:

The disclosure that Musk approached Apple is not surprising.

Sure, but what was in it for Apple?

The price being bandied about is $60 billion. So, what was there that was worth that much. Or, even, what is there that is worth that much when Tesla is worth $600 billion as today?

Well, actually, it’s the hope, the dream, that it’s going to become the world’s major EV manufacturer. Hey, we can laugh at that ambition and even insist that it’s currently vastly overvalued. But others disagree with us and market prices are indeed market prices.

So what would Apple be buying for the $60 billion? That hope and dream. Sure, there’s the occasional bit of technology in there but really, nothing that’s worth that much. Lidar can be bought elsewhere, batteries, electric motors, they’re all available elsewhere.

If Apple wanted to capitalise on that dream value what should Apple do? Well, start looking into its own batteries, Lidar, electric motors and the rest. Because it would be the creation of the dream that adds the value.

No, really, anyone with $20 billion to spare could go out and start producing electric vehicles. It’s not as if Tesla has consumed – so far at least – more than that in capital. The value additive thing is the creation of the tech that might meet the dream, not buying something already valued as meeting the dream. This is why Nikola, Nio and all the rest are at their own absurd valuations.

But leave aside all of this for a moment. Think like a proper businessman. You know, like Tim Cook.

Tesla can be bought for $60 billion. Ford for $40 billion. So, you want to revolutionise the world with EVs. As an already startling brand with decent technical knowledge you’re going to buy which?

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