Palo Alto, CA – November 15, 2016
Our standing view is that the scaled-down car strategy that Apple is apparently pursuing holds risks for the company. Samsung’s announced Harman acquisition likely makes the Tier 1 route (the path we believe Apple should now be taking in automotive) more competitive for Apple, reprising the role that Samsung played in making Apple’s smartphone path more difficult over the years. Up until the Samsung news, there had been no strong Android-based Tier 1 pursuing the automotive electronics space; post the announced purchase, we believe the environment for Apple will be more competitive, denting its market potential somewhat.