While a simple statement like that may seem like pure speculation, other industry sources agree with Calacanis’ announcement.
Calacanis’ prediction: Apple will buy Tesla for $75 billion
Despite the fact that Calacanis introduced his recent blog post with three important disclaimers – (1) “I have no inside information,” (2) “I hold no shares of Tesla or Apple,” and (3) “I do own two Teslas and spend $3k per year on Apple products personally” – there is no reason to doubt his report or predictions. He’s one of those guys that you listen to, and other Wall Street analytics and industry thought leaders agree with his sentiments.
In fact, it’s not really as ground-breaking as many are suggesting; all the signs are pointing to it. It just took somebody of authority to say it. There have been reports of an Apple self-driving car on the roads, hundreds – possibly even thousands – of Apple employees and executives have been working on an electric minivan, and Tesla CEO Elon Musk has been very clear that his company is looking to launch a third generation vehicle.
Calacanis then reviews the previous announcements and release dates of previous Tesla vehicles, noting that the company typically announces new cars between 24 and 48 months prior to their release. His conclusion? “What this means to me is that Apple would be desperate to buy Tesla between when the Gen 3 is announced but before it is delivered, because once the Model 3 hits the road Tesla’s market cap would make a deal with Apple a merger — not an acquisition.”
He then goes on to mention a list of 19 calculated reasons why Apple is the likely buyer of Tesla Motors. Each is compelling and strangely logical, which makes Calacanis’ prediction even more believable. In fact, it’s so logical that it leaves most analysts thinking ‘Why didn’t I think of this?’
Why this $75 billion prediction makes sense
As Global Car Brands shows in their chronological history of the auto industry, ever since the first steam-powered vehicle was built in 1672, carmakers have been striving for more automation and less of an environmental impact. It just so happens that Apple is all about automation and Tesla is built on renewable energy. Here are a few of the top reasons why this $75 billion prediction makes sense in the eyes of so many:
• Apple needs help. As Calacanis points out, even if Apple has an idea for a car – it will take years to get it on the road. Logistically, by the time the design is perfected and factories are built, it could be 7 to 10 years before a car hits the road. Waiting that long is a risky move for Apple, and Tesla could greatly accelerate the speed at which a potential car is be built and released.
• Tesla needs help. Tesla wants a third generation vehicle, but the truth is that they want better technology in that vehicle. While they are fully capable of developing their own devices and software, nobody has more resources and capabilities than Apple.
• Compatible cultures. Industry experts always say that Tesla was built on Apple’s business model and much of the late Steve Jobs’ influence can be found in the company. The truth is that Apple and Tesla are more compatible than most understand or want to believe. They both believe in user-friendly technology, innovation, and premium products. Both have a cult-like following and a desire to change the world for the better. There would be little need for either company to change the way they operate and a merger would be nearly seamless. In fact, there are reports that more than 100 former Apple employees are now working for Tesla.
• Only one other suitor. As Calacanis notes, there’s really only one other potential suitor: Google. They too are developing a next generation vehicle and have the financial capability to make a run at Tesla. However, they don’t bring quite the value-add that Apple would and their cultures aren’t nearly as compatible.
• Musk doesn’t want money. Musk is reportedly worth over $12 billion and those close to him know that money is not an object. What he really wants is to be able to change the world. Aligning his superior car brand with the leader in global technology would bring that dream closer to reality.
Only time will tell
While a prediction from Jason Calacanis is rarely wrong, this deal is anything but complete. As far as anyone knows, it’s still simply speculation. However, it appears that there is some truth to the prediction – as well as plenty of logic to support it. Only time will tell if this $75 billion prediction will change the world.
