Elon Musk, the Chairman and CEO of Tesla Motors welcomed the widely speculated entry of Apple into the car manufacturing business, and he doesn’t see any threat from the tech giant’s poaching of engineers.
During the electric car manufacturer’s earnings conference call, an analyst asked Musk if he is starting to feel greater sense of competition with Silicon Valley parties such as Apple in terms of tracking and retaining key software and automotive engineering talents.
Musk describes Tesla vs. Apple poaching as 5:1
Musk said, “I certainly hope Apple gets into the car business. That would be great. But we’re not seeing any significant attrition of engineers to Apple, for anything, cars or otherwise. Anyone can find this out by going on LinkedIn.”
Musk added that Tesla recruited more talents from Apple than the tech giant from the electric car manufacturer. According to him, “If you look at the trailing 12 months, I think Tesla has recruited something like five times as many people from Apple as Apple has from Tesla. It’s some fairly high number.”
There were speculations that Apple was forming an automotive team to develop its electric car under a project called “Titan,” and it was aggressively recruiting experts in the auto industry. It was also rumored that Apple would acquire Tesla, and it would start producing the Apple Car by 2020.
Apple Car threat to auto industry years away
Last month, Bernstein analysts commented that the Apple Car idea was not totally bizarre, but its threat to the auto industry is still years away. According to them, Apple needs to overcome a number of technical barriers and to align series of revolutionary developments simultaneously for it to become feasible in the auto industry.
At present, the analysts suggested that Apple is assessing the auto industry based on reports, but its depth of commitment to entering the business is still uncertain. They think Apple is already at the concept design stage of building an Apple Car.
Tesla Energy could become a bigger business than electric cars
Musk said there is an overwhelming demand for Powerwall, the new energy storage system of Tesla. The company is selling two version of Powerwall, a 7kWhh ($3,000) and 10kWh ($3,500) units.
Tesla introduced Powerwall last week, and the company already received orders for 38,000 units. Musk said Tesla Energy has the potential to become a bigger business than electric cars.
“The total addressable market size for Tesla Energy products is enormous and much easier to scale globally than vehicle sales,” said Musk.
Tesla is currently preparing its supply chain and production teams to start volume builds for its new energy storage system products in the third quarter. The company will start production at the Tesla Factory in Fremont. Tesla plans to expand and accelerate its production significantly at the Gigafactory in the first quarter of 2016.
Musk said Tesla is pursuing product certification in multiple markets simultaneously and plan to ramp deliveries in the US, EU and Australia in the fourth quarter.