Welcome back! 🍎
Here’s what’s new with Apple.

• Apple Car is dead, but CarPlay might benefit

• iOS 18 redesign coming?

• Why the FineWoven case is a disgrace

• The crazy production costs for Apple Vision Pro 

• & more

📖 Read time: 3.7 minutes

📊 Poll

In the last poll, I asked: Would you wear a fitness ring?

Here are some of my favorite replies:

This week: Have you ever bought an iPhone case from Apple? Did you like it? More on this later.

🗞️ The Latest

🚗 Apple Car is Dead

Apple just killed the Apple Car project after working on it for over 10 years and investing over $10 billion into research and development.

• Apple's COO had to tell 2,000 employees that the Apple Car project was canceled this week.

• Many who were involved in the car project have been moved to Apple's artificial intelligence division to work on generative AI features.

• If it ever came to market, an Apple Car was likely to cost at least $100,000 and would still only generate razor-thin profit margins.

• Apple previously held discussions with Elon Musk about acquiring Tesla, but they ultimately decided to build their own. Now, $10B and many years later, that looks like a mistake.

• For reference, Tesla has spent a total of $9.7B on R&D in the last 3 years combined.

Why this might be good

• My [probably wrong] theory is that Apple has known, for years, that the Apple car project would fizzle out.

  • And some of the software meant for the Apple Car went into CarPlay 2.0, which was announced at WWDC 2022.

• So, with the car out of the picture now, we should see major enhancements to CarPlay in the coming years.

• Communicating with the car’s control modules will be a major leap forward, as you’ll be able to customize the look of the instrument cluster later this year.

• I am hopeful that future iOS versions will come with more intricate CarPlay features and changes. After working for 10+ years on the Apple Car, I have to imagine there’s plenty more to come.

Apple still wants to dominate

Apple still wants to dominate the car market, just not in the sense of selling an actual car. Too expensive and low margin.

So what has sky-high margins? Software!

• Apple wants to dominate the in-car experience via CarPlay.

• As of now, CarPlay and Android Auto are very similar. I expect that to change starting this year.

• Tesla, Rivian, and GM are all anti-CarPlay. What if that changes now that an Apple Car is out of the picture?

• What if Apple turns CarPlay into a $4.99/month service once it gets more sophisticated features?

There are many questions about the future of CarPlay but everything seems to be bullish for Apple.

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📲 iOS 18 will have a redesign, but not the one you want

• iOS 18 will allegedly add new visionOS-inspired design elements.

• Many wanted a complete overhaul of iOS, but that is unlikely, according to Gurman. Expect minor UI changes in Settings & first-party apps.

• Gurman also says that a macOS revamp is 1-2 years away.

All about AI

There’s one thing that isn’t a question at this point: iOS 18 will include new AI/machine learning features.

• During Apple’s annual shareholders meeting this week, Tim Cook said that the company will "break new ground” in generative AI in 2024 and said, "We believe it will unlock transformative opportunities for our users.”

• According to a new report from TrendForce, AI server makers such as Supermicro are "aggressively expanding its efforts to secure AI orders" from Apple.

• All eyes will be on Apple come WWDC 2024 in June.

🥽 Vision Pro is also Expensive for Apple

• According to Omdia, the components used to construct the Vision Pro are estimated to cost Apple $1,542.

  • Starting at $3499, that gives Apple a profit margin of 55.93%

• Of all the components, the pair of micro-OLED displays are the most costly.

  • The displays cost an estimated $228 per display. So, $456 per headset.

• Then, the external display (or “sub display”) costs $70.

• That brings the total, for the 3 displays alone, to $530. That is 35% of the total cost!

With ~50% of the total cost going to the displays and the M2 + R1 chips, I see a possible path for the 2nd generation to cost less than $1000 for Apple. That would be a ~43% cost reduction if so.

1st gen products are always the most expensive because the order quantity is low, the manufacturing process isn’t seamless yet, and parts are usually at peak prices with no competition.

Hopefully we see the Apple Vision Pro 2 in early 2027 with a starting price closer to $2599.

“Crack-Gate”

Speaking of Vision Pro, there’s officially a new “gate” issue: #CrackGate.

There have been a handful of owners reporting a mysterious crack down the middle of the outer glass display.

Luckily, this only seems to be affecting a very small percentage of owners.

But for those unlucky customers, Apple Support is allegedly asking them to pay for the repair costs (~$800), since the crack has not been officially identified as a manufacturing defect. Yikes!

🫠 Apple’s FineWoven Disaster

Six months ago, when Apple replaced their genuine leather iPhone cases with eco-friendly “FineWoven” cases, there was instant criticism.

Now, half a year later, the ones who bought a FineWoven case seem to be regretting that decision.

It’s not just the journalists who are seeing rapid degradation of their FineWoven cases:

Some have mentioned that Apple was trying to mimic leather patina - the natural aging process of leather. Even if that was the case, they did a terrible job because these cases do not look good after a few months of use.

Do you have a FineWoven case from Apple? How is yours holding up?

📰 Quick News Bites

• Apple Music launches new personal ‘Heavy Rotation’ mix, updated daily

• Inside Apple Arcade: axed games, declining payouts, disillusioned studios – and an uncertain future

• Apple ID Could Be Rebranded to 'Apple Account' Later This Year

• MacPaw announces ‘Setapp Mobile’ app store coming to the EU in April

• iPhone 17 and iPhone 17 Plus to Feature ProMotion Always-On Displays

• Apple’s Major Shareholders Push for Artificial Intelligence Transparency

• Microsoft Begged Apple to Adopt Bing as Safari's Default Search Engine

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