Picture a couple of years from now as fans are getting psyched for Apple’s (Quote, Chart NASDAQ:APPL) new product launch, hoping to get a first peek at the company’s latest and greatest tech offerings.
Only this time the stage won’t be occupied by some executive holding up another version of the iPhone — instead, we’ll get, in classic Bob Barker style, “a new car!”
Likely? We’ll see. But the idea of Apple acquiring auto-maker Tesla (Quote, Chart NASDAQ:TSLA) is far from outrageous, says entrepreneur and venture capitalist Bruce Croxon, who thinks they’re actually a perfect match.
Today is launch day for Apple, as the tech giant is expected to roll out three new, yet-unnamed versions of the iPhone, one of which will be a lower-priced model aimed at digging into Android’s market share, while another will feature an even bigger screen.
But the more fascinating conjecture of late, to some of us, concerns a potential Tesla investment. On the pro side, we have many of the punditry counting up the number of ex-Tesla employees that Apple has hired this year, while others are pointing out that Tesla’s operational and cash flow struggles could find their saviour in Apple’s deep bench and deeper pockets.
On the con side, we have none other than Warren Buffett who recently poured cold water on the whole idea, saying that the industries are too different, with the auto sector being much tougher than tech to build up a competitive advantage.
But count Croxon among the enthusiasts.
“I can’t believe they haven’t done it already,” Croxon said on BNN Bloomberg’s The Disruptors . “To me, it’s a union that makes all the sense in the world. You’ve got the two leading edge design companies coming together. You’ve got a company who knows how to operate, Apple’s sitting on a tonne of cash, cash is going to be an issue for Tesla unless they get things turned around in an awful hurry.”
At the same time, even with all the controversy surrounding Tesla CEO Elon Musk —pointing out just a few items: the berating conference call earlier this spring, the go-public tweet last month and, more lately, the weed smoking podcast— Croxon still thinks that both Musk and his company are heading in the right direction.
“Wrap all this stuff up together, I think the guy is still going to have the best quarter he’s ever had with Tesla,” Croxon says. “They’re getting the production stuff sorted out. [Musk] continues to surprise and shake the market with some uncharacteristic CEO behaviour, but the real issue is, can this company do what it needs to do in terms of production? And my money still says that it can.”