Meet Apple (NASDAQ:AAPL) Newest Invention: The Apple Car

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Apple
Ticker: NASDAQ:AAPL
Price: $114.95

Apple Outlook

Apple is believed to be working on an electric vehicle project that it plans to launch a few years down the road. The top-secret project is said to be in the works at a hidden lab named “SG5” in Sunnyvale, Calif. Internally, the effort is believed to be known as “Project Titan” and may one day yield an “Apple Car.”

Rumors have long suggested Apple is actively working on a variety of different automotive projects that could ultimately lead to an “Apple Car.” The entirety of the research falls under the catch-all title “Project Titan.”

The term has been used to describe a number of different elements and technologies, but fall into two broad categories: self-driving vehicle systems and car design.

While initial reports pointed towards the creation of an entire Apple-designed vehicle, the titular “Apple Car,” the rumors have also indicated a change of focus for Apple. One that pulled it away from the grand design of a full automobile and onto just self-driving systems. 

However, many rumors, reports, and patent filings have emerged since that supposed pivot, suggesting the full car design aspect is still alive and becoming more of a central element to Project Titan as a whole.

“Apple Car” features and testing

Self-Driving Systems

Kept under the “Project Titan” name due to its closeness to the original car-design concept, Apple’s work on self-driving vehicle systems have been the most prominent element of the entire scheme.

Unlike the designs, which are brought up in patent filings and rumors, it is actively known Apple has developed and tested a self-driving system, one that has appeared in public filings with government regulators, and has even been spotted on public roads.

PERMITS AND LEGALITIES

In an early public admission of its automotive ambitions, Apple, in a statement issued to the National Highway Traffic Safety Administration in November 2016, proposed a policy update that would grant industry newcomers the same opportunities as established manufacturers when it comes to testing on public roads.

Then-director of product integrity at Apple Steve Kenner said the Federal Automated Vehicles Policy paved a safe and flexible path toward the development of automated vehicles, but suggested proposed regulations could be more open for companies new to the industry.

Alexander Hitzinger formerly of Porsche and now said to be working on “Project Titan.”

On April 14, 2017, the California Department of Motor Vehicles added Apple to the list of companies granted permission to test self-driving vehicles in the state, a sign that Apple could still be working on “Project Titan” and “Apple Car.”

The granting of the Autonomous Vehicle Testing Permit allowed Apple to take a self-driving car onto public roads, with companies unable to legally perform such testing without the permit. Apple is believed to have met with the state’s DMV in 2015, possibly in discussion of gaining permission for on-the-road testing, but continued testing on private property at the time. 

Apple’s initial permit covered three vehicles, all Lexus RX540h SUVs, with six drivers serving as backup in case the onboard systems encounter problems. Considering the use of Lexus SUVs, it is probable that Apple is testing just its sensing and AI technology, rather than an entirely new vehicle. 

One reason for using existing vehicles for these tests is that driving an “Apple Car” that Apple has created would spoil the surprise for its launch. Publicly showing off a new vehicle design would also directly hand ideas to other car manufacturers, potentially allowing them to innovate on Apple’s car before it is unveiled.Training gear used for testing the self driving module of a potential “Apple Car”

As part of its application to the California DMV for permission to test self-driving cars, Apple provided the government agency with documents meant to train potential safety drivers, before the vehicles are taken out onto public roads. 

The “Development Platform Specific Training” documents revealed the drivers must pass basic tests before being allowed to set off, with the tests ranging from basic maneuvering to vehicle systems intervention. This includes low-speed and high-speed driving, U-turns, sudden steering input, sudden acceleration, braking, and managing “conflicting turn signal and action” events. 

When the vehicle is not being controlled by software, drivers are able to electronically take the wheel via drive-by-wire technology, using a Logitech steering wheel and pedal system fitted in front of the Lexus RX450h’s drive controls. Pilots can disengage the autonomous driving system by pressing the brake pedal or grabbing the steering wheel, and should be able to accelerate without overriding the system at all. 

The reports that followed being granted permission to test, as well as other coverage of self-driving projects, has prompted Apple to write to the DMV, asking for clarification to changes to the way it reports events.

Specifically, Apple wanted clarification on “disengagement reporting,” which are reports generated when the safety driver disengages the self-driving system, such as to avoid accidents or to manage unexpected events. Apple wants to tighten up these reports, as well as to exclude details of planned tests, the end of testing, operational constraints, and other discretionary decisions performed by the the driver. 

Apple also asks not to speculate “about future events that have not occured” when reporting incidents that would have happened if the driver had not disengaged. 

“Apple believes that public acceptance is essential to the advancement of automated vehicles. Access to transparent and intuitive data on the safety of the vehicles being tested will be central to gaining public acceptance,” writes Apple Director of Product Integrity Steve Kenner. “However, the current and proposed disengagement reporting requirements do not achieve this result.” 

A few years later in February 2019, it was revealed by the DMV that Apple’s self-driving car testbed was the worst-performing system on roads in terms of disengagements, in last place among 28 firms testing autonomous vehicles on California roads. 

Apple explained to the DMV in a letter the system was designed to be conservative for safety purposes, with it erring towards manual control in a considerable number of instances. Drivers were also instructed to assume control “any time they deem necessary,” again due to safety concerns on public roads.

CAR AND DRIVER COUNTS

As of January 2018, the state of California permitted Apple to have 27 self-driving cars running on public roads. While a huge leap from the three Lexus vehicles from April 2017, it is was still far behind the large fleets operated by competing firms. 

By March 2018, the fleet grew to 45 vehicles on California roads. The following May, the figures reached 55 test vehicles and 83 authorized driver, and in July, Apple was registered with the California DMV to bring the fleet up to 66 cars, before peaking at 72 vehicles and 144 drivers in November 2018. 

In April 2019, data from the California DMV indicated Apple had 69 vehicles and 110 drivers, a reduction in the numbers. 

The following August, the same data source showed Apple as having 143 registered pilots, though not the number of cars being used. 

In February 2018, the California DMV received approval from the California Office of Administrative Law to set regulations in place to allow companies to test remotely operated autonomous vehicles on public roads. From April 2, the DMV’s public testing framework allows for self-driving cars to go on the road without a driver behind the wheel, instead with human “remote” drivers monitoring the drive using a communications link, ready to take control of the car from the onboard systems in the event of an emergency. 

TESTBEDS AND SENSORS

One of the Lexus used to test Apple’s Self driving systems being developed for “Apple Car”

The first sightings of a vehicle used by Apple for its self-driving car test surfaced in late April 2017, spotted departing an Apple facility.

The initial tests, as anticipated in DMV records, involved adding extra equipment to a pre-existing vehicle. The images confirmed the use of a Lexus RX450h, colored in white, with a number of extra items bolted onto the car. 

On the SUV’s roof was a Velodyne LiDAR 64-channel unit, bolted to a custom frame, and radar arrays are mounted onto the front and rear bumpers. Cameras in protective housings surround the car’s exterior, providing the self-driving system with a 360-degree view of its surroundings. 

While the testing documents advised of the use of a Logitech steering wheel and pedal system, the test vehicle itself did not appear to use the items at all. This suggested the extra wheel was just for evaluation purposes, or that Apple has managed to get its self-driving technology working with Lexus’ onboard systems, leaving the steering wheel free to be used by the test driver. 

A road user spotted what could be an updated version of Apple’s self-driving testbed on August 25 the same year. The vehicle was reportedly parked outside of an Apple office in Sunnyvale, California. 

It appeared from the photographs that Apple is using the 2016-2017 Lexus RX450h, a newer model of the 2015-edition vehicle previously used for testing. A change in the positioning of the equipment to fit entirely on the roof of the vehicle was spotted at the time, with upgrades and a new look also applied to the test bed. 

Though difficult to specify what equipment is being used, it seemed that Apple used a Puck LiDAR sensor from Velodyne, a 16-channel unit that can log 300,000 points per second at a range of up to 100 meters. A total of 14 Pucks appeared to be mounted to the car, with four facing forward, two behind, and two at each corner. 

Other equipment on the vehicle included various cameras, a GPS unit with antenna, radio communications equipment, and a distance measuring system. Aside from the central sensor array, five yellow-capped sensors were visible, which could have been compact radar arrays to assist the main sensing system.

Efforts are being stepped up with regards to sensors, with an April 2019 report indicating the company is in talks with component suppliers making parts that could be used in self-driving systems. Apple has reportedly talked to multiple LiDAR sensor suppliers and is apparently evaluating technology on offer while simultaneously working on its own LiDAR hardware. 

While this research is more for testing at the moment, the talks could also relate to future manufacturing efforts, including making smaller components that could shrink down the overall collection of sensors to a more manageable size, possibly to one that could be more easily integrated into the “Apple Car’s” design.

POTENTIAL PARTNERSHIP WITH HERTZ

A June 2017 report from Bloomberg claims Apple partnered with rental car provider Hertz in order to test out its self-driving vehicle systems. While such systems would have a commercial use for rental cars, such as vehicles automatically driving back to a rental outlet and saving customers from driving them there themselves, it appears the partnership was mostly for testing purposes only.

According to the report, Apple apparently leased a “small fleet of cars” from Hertz subsidiary Donlen for the driving trials, with the Lexus RX450h SUV specifically chosen due to the model already being used by Apple for the project. A later report from CNBC claimed Apple is leasing just six vehicles from Donlen, a small number, but one that would effectively double the number of vehicles Apple was testing on public roads at the time. 

It was unclear if the vehicles will be used just by Apple’s nominated drivers only, or if Hertz customers could be able to rent the vehicles in question with the driving system installed, but the relative silence suggests members of the public were not involved. 

CAMPUS SHUTTLE TESTS

In August 2017, the New York Times reported Apple was working with an established automaker on a self-driving shuttle testbed. In this case, Apple is said to be providing the autonomous driving technology, while the car manufacturer handles the commercial vehicle fleet. 

The project will apparently carry Apple employees between Silicon Valley offices, with the Palo Alto to Infinite Loop route giving the scheme the name PAIL. It is unknown when the vehicles will hit the road but it is likely to be a welcome addition for employees working at the Apple Park campus. 

The next year, it was claimed Apple was working with Volkswagen on the project, with the automaker providing T6 Transporter vans. The vehicles would be outfitted with specialized dashboards and seats, with further modifications to on-board computers, sensors, and an electric battery. The Volkswagen T6 Transporter

CAR ACCIDENT

Apple’s first reported accident involving a self-driving vehicle took place on August 31, 2018. The low-speed accident involved the car being rear-ended by a Nissan Leaf, which was traveling at just 15 miles per hour. 

Despite the low speed, both vehicles received “moderate” damage, and there were no serious injuries.

Patents and Applications

As with other Apple products, the company has been keen to make a large number of patent applications in relation to the in-development car and driving systems. In recent years, more of these patents have surfaced, firmly cementing Apple’s interest in the field, though stopping short of guaranteeing Apple will actually produce an “Apple Car.”

Self Driving patents and safety

An initial example of Apple’s work on autonomous vehicles, a patent application surfaced in December 2016 detailing a method of “Collision Avoidance of Arbitrary Polygonal Obstacles.”

Able to work in two-dimensional and three-dimensional space, the patent application outlines systems and methods to traverse an environment, without prior knowledge of obstacles. This also takes into account convex and concave objects, moving and stationary obstacles and other things that can affect movement through an area. 

For vehicle systems, this would effectively allow a car to traverse a landscape, including moving obstacles and other barriers to movement.

In July 2018, Apple proposed the self-driving system could modify its behavior depending on the stress level of the car’s occupants, using internal sensors to measure a variety of data points. If stress is detected, the system could switch to a slower speed, or could take corners at a slower rate. 

A “confidence” system could help reduce the required resources to process the mountain of data from onboard sensors, cutting down what needs to be processed if it believes there isn’t need to do so beyond a minimum level. Aside from saving resources, this may help speed up decision-making processes. 

The use of VR and AR has also been an important element, including using a projection system on the windscreen to show an AR view of the road, including elements out of the user’s vision, such as the intended path the self-driving system wants to take. 

The use of headsets for AR or VR hasn’t been discounted, with Apple even suggesting how to minimize car sickness while using the devices. 

Self-driving vehicles need to tell other road users what their intentions are, something that Apple believes could be enhanced. A sign on the back or sides of a vehicle could explicitly tell other road users what the “Apple Car’s” next move will be. 

This could also take the form of a light strip on the perimeter of the vehicle, which could potentially function as a large brake light or indicators. 

Inter-car communications could provide enhanced situational awareness, such as by one self-driving car system alerting others to their position. Skid recovery systems may help keep the car under control in hazardous conditions. An illustration of calculations to determine the slip angle for a skid detection system

While the self-driving system would be intended to take the car owner from place to place, Apple may already have plans to use it for taxi systems. It has envisioned the possibility of summoning a self-driving hire car via an iPhone, which could also provide access to the vehicle and facilitate payment. A car may prompt an iPad-using driver to pay more attention to the road.

Apple devices could play another key role in autonomous car features by displaying alerts to those within the vehicle. If the “Apple Car” is self-driving, then passengers may not be fully aware of the environment outside the vehicle. Alerts to pay attention if anything unusual is sensed outside the vehicle could mitigate some disasters.

The sensor system may have more than just uses for driving, as Apple suggests it could be used to take pictures of points of interest. This could range from scenery on a route to the scene of a car accident, facilitating easier reporting to insurers. 

Due to the system’s construction, there is the potential of allowing other drivers to take control of a car via the self-driving mechanism. One proposal has a remote operator, such as a driver trained for emergency transit situations, guiding a self-driving vehicle to a hospital. 

Apple has also looked into how to hide the plethora of sensors within the bodywork.

A patent for a specialized airbag system was filed, and would protect passengers who may be facing each other in a self driving vehicle.

The use of LiDAR and other sensors will be used for more informed decision making. Increasing the number of data points will increase the accuracy of a decision.

“Apple Car” Design

Apple’s patent applications also cover the design of elements of vehicles. While this can include more pedestrian areas, such as power train systems, this also steps into redesigning essential concepts in vehicular design, rethinking basic elements in unusual ways. 

The sunroof of an “Apple Car” could be set to slide a large glass panel, but in such a way that it remains central despite the car framework and tracks diverting away in non-parallel lines. A multi-segmented sunroof with independent sliding and lifting sections has also been proposed. 

A headlight system could highlight road hazards for drivers, such as by using an “illuminated indicator” shone next to an obstacle, or specifically illuminating sections of the road. 

An anti-glare system for the windscreen could protect drivers from bright lights by dimming or blocking out parts of the glass, while leaving the rest transparent. 

Continuing the theme of lights, Apple has suggested alternative ways to illuminate the inside of a car. These have ranged from fiber optic systems to an interior lighting system using band pass filters to offer privacy, by making it hard for onlookers to see into a vehicle. 

TrueTone technology borrowed from other Apple hardware could also be employed to ensure there is an even internal lighting inside of the car. 

The seats and seatbelts have received particular attention by Apple, such as the use of a smart seatbelt that could control CarPlay devices. Illuminated seats could inform users of how to adjust them for comfort or simply to buckle up. Proposed light patterns from the illuminated car seat patent application

Even the doors have been worked over, including versions with wide openings that remove the center pillar, sliding doors, and the use of force-feedback hinges. 

Retractable bumpers could help keep the vehicle pristine for longer, by using inflatable sections to cushion the blow from impacts. 

On the more pedestrian side, a patent application from 2018 showed Apple was keen on designing a “converter infrastructure” for using high-voltage sources for lower-voltage systems. A battery floor has also been designed. 

The use of electricity can allow for unusual use cases, such as a peloton of cars that could share power between each other. 

Wireless charging systems, including one idea where a small robot on the floor plugs the charging cable in underneath the car, have also been proposed. 

Innovations such as Ultra Wideband radios included in the iPhone 11 could also be used, such as to provide keyless entry. 

Business Summary

Apple Inc. designs, manufactures and markets mobile communication and media devices, personal computers and portable digital music players.

The Company sells a range of related software, services, accessories, networking solutions, and third-party digital content and applications.

The Company’s segments include the Americas, Europe, Greater China, Japan and Rest of Asia Pacific.

The Americas segment includes both North and South America. The Europe segment includes European countries, India, the Middle East and Africa.

The Greater China segment includes China, Hong Kong and Taiwan.

The Rest of Asia Pacific segment includes Australia and the Asian countries not included in the Company’s other operating segments.

Its products and services include iPhone, iPad, Mac, iPod, Apple Watch, Apple TV, a portfolio of consumer and professional software applications, iPhone OS (iOS), OS X and watchOS operating systems, iCloud, Apple Pay and a range of accessory, service and support offerings.

Price Performance

Relative Valuation

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 125.27.

The projected lower bound is: 104.24.

The projected closing price is: 114.75.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 25 white candles and 25 black candles.

A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 3 rising windows in the last 50 candles–this makes the current rising window even more bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 41.8094. This is not an overbought or oversold reading. The last signal was a buy 0 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 50.49. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 43 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -8. This is not a topping or bottoming area. The last signal was a buy 0 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 10 period(s) ago.

Rex Takasugi – TD Profile

APPLE INC closed up 4.510 at 114.950. Volume was 100% below average (consolidating) and Bollinger Bands were 20% narrower than normal.

Open      High     Low     Close      Volume
114.140   115.590  112.350 114.950    176,122
Technical Outlook
Short Term:        Neutral
Intermediate Term: Bearish
Long Term:         Bullish
Moving Averages: 10-period     50-period     200-period
Close:           113.20        116.37        91.19
Volatility:      57            57            61
Volume:         109,999,592    154,893,712   169,201,392

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

APPLE INC gapped up today (bullish) on light volume. Possibility of a Common Gap which usually coincides with a lack of interest in the security. Common Gaps are fairly irrelevent for forecasting purposes. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.

APPLE INC is currently 26.1% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of AAPL.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on AAPL.O and have had this outlook for the last 0 periods.

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