Apple Car Could Be Further Delayed Due To Global Chip Shortage?

While Apple just reported blockbuster Q4 earnings for 2021 which even featured a doubling of its business in India, it has warned the global semiconductor shortage could throttle its growth across the board. 

"By the time we finish this quarter, the constraints will be larger than the $6 billion that we experienced in Q4 (July-September period)," Apple's CEO Tim Cook revealed in its earnings call. 

"There were two causes for this in Q4. One was the chip shortages that you've heard a lot about from many different companies throughout the industry. And the second was Covid-related manufacturing disruptions in Southeast Asia," Cook explained. 

Cook also revealed that Apple's earnings could've been even better and he estimated that the revenues of the California-based giant took a massive hit of $6 billion in the quarter alone. 

"Primarily, we buy leading-edge nodes, and we're not having issues on leading-edge nodes. But on legacy nodes, we compete with many different companies for supply and it's difficult to forecast when those things will be normal," Cook elaborated.

The iPhone maker has warned that its growth could be stunted because of the chip crisis

Cook's reference to issues with legacy nodes is notable which could even impact the Apple Car project. Already the project has had a tumultuous history and recently it even lost Doug Field to Ford who was the day-to-day executive in charge of its development. 

Apple has also been facing resistance from suppliers for batteries and hasn't locked in a manufacturing partner for the car. As we noted in our analysis of what was triggering the global semiconductor crisis - automotive microprocessors aren't leveraging leading processor nodes that Apple's iPhones or MacBook use. 

Apple's partner TSMC as noted by Cook doesn't provide Apple a free hand with a supply of older chips which could be an issue for the Apple Car project and further push back its development by a year or so. 

Apple's latest gadgets use a 5nm node while automotive chips are built on outdated technology like 28nm. Even the most cutting-edge self-driving chip that Tesla uses is made on a 14nm node which was the technology used in 2015 by flagship smartphones. 

Apple has many big projects in the pipeline but the most important two include VR and AR glasses which are expected in 2022 and Apple which is expected at the earliest in 2024, but likely will get delayed by a couple of years. These two product lines are also supposedly going to be the last major product announcements under the reign of Tim Cook who is likely to retire from Apple before the end of the decade.