Opinion: A US$21bil wager on who’ll build the Apple car

If Apple were to become a Magna customer it would drive the same hard bargain as it does with Foxconn, whose operating margins have shrunk to about 2%. Apple’s is 24%. — AFP

A red-hot trend in the car industry is for new entrants such as Fisker Inc to hand over the complicated and capital-intensive work of engineering and building vehicles to a contract manufacturer. Increasingly, cars are judged on their software and electronics so why bother wasting time and money on metal bashing?

If Apple Inc is indeed seriously considering launching its own vehicle, as press reports suggest, then it will almost certainly decide to outsource, as it does with the iPhone. Apple designs the phone and its operating system but employs Foxconn to assemble components into a handset.