Apple on track to top $3 trillion valuation with autonomous car push

Apple chief Tim Cook could steer Apple to a $3 trillion value if plans to build a car go ahead

Credit: Getty Images 

Apple could hit a $3 trillion (£2.17 trillion) valuation for the first time should it finalise a deal to build its own car.

The Cupertino-based giant, which became the first US company to surpass a market capitalisation of $2 trillion in August, is believed to be in talks with Hyundai-Kia to manufacture an Apple-branded autonomous electric vehicle.

It took Apple 42 years to reach a $1 trillion valuation but just two more years to break the $2 trillion mark.

A team at the tech firm is working on the “Apple Car”, which has tentatively been lined up for a 2024 release. It follows years of speculation that the iPhone-maker would enter the auto industry.

Dan Ives, an analyst at Wedbush, said that Apple’s entry into the market could add at least $30 to the value of the company’s shares over the coming years.

“The EV market is what could ultimately be a trillion dollar opportunity globally over the next decade and it’s a smart strategic move for Apple to dive into the deep end of the pool on this new age of EV vehicles,” he said.

“The company has been working in Cupertino for years around this autonomous vision and we believe a potential larger strategic partnership with an established auto player such as Hyundai, Tesla, Ford, or VW would be a golden partnership for the next decade tapping into this EV opportunity.”

Mr Ives said that investors “would prefer” for Apple to partner with existing car manufacturers than for the tech firm to build the car itself.

The Wedbush analyst said the move into electric vehicles would “expand the massive total addressable market for Apple”.

Apple’s share price currently stands at $133.94, should entry into the EV market force the price upwards by $30 it would bring the company’s value up to over $2.9 trillion. Should growth in the tech firm’s other channels like iPhone and iPad sales continue to soar it will easily eclipse a $3 trillion valuation.

Apple sales by division

An agreement between Apple and Hyundai-Kia has yet to be reached and some have suggested that the iPhone-maker may go with another manufacturer entirely.

Apple has yet to comment on the reported deal.

Shares in Hyundai soared 14.5pc on Wednesday off the back of local reports that an agreement was close.

Last month, Apple reported record-breaking profits after enjoying the iPhone 12 became the most successful launch in its history.

The world’s biggest publicly traded company revealed a 21pc increase in revenues to $111bn, the first time its sales had crossed the $100bn mark in a single quarter, and said profits had jumped by 29pc to $28.8bn.