Apple Could Takeover Tesla With Huge Cash Reserves, Says Citi

Citigroup has cited Tesla and a number of other large companies as potential takeover targets for Apple.

The technology giant currently has more than $250 billion in cash waiting to be put to work and in a note to clients, Citigroup analyst Jim Suva said Tesla, Netflix or Walt Disney are all possible targets for Apple, Reuters reports.

As is stands, over 90 per cent of Apple’s money is overseas but under new proposals from President Trump, mutlinationals could bring overseas profit into the U.S. at a 10 per cent tax rate compared to the current 35 per cent rate. Apple could therefore bring about $220 billion to the U.S. and use it in a huge takeover.

“Since one of the new administration’s top priorities is to allow US companies to repatriate overseas cash at a lower tax rate, Apple may have a more acute need to put this cash to use,” Suva said.

While Apple could easily takeover Tesla with its $51 billion market cap, it’s unlikely to happen. A few years ago, there was similar talk of an Apple takeover but it failed to eventuate. Considering that Tesla chief executive Elon Musk believes his company can exceed Apple’s $750 billion valuation within a decade, it is hard to believe he will relinquish control of the electric automaker.

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  • Kash

    They could do it but most likely won’t. Apple has shifted away from wanting to build an entire car to just making the autonomous tech for cars, they want to be parts supplier.

    • MonkeyRider

      Your personal opinion? or any source?

      • Kash

        Logical conclusions based on some readily available info.

        There’s the fact that Apple is using Lexus RX’s to test autonomous tech. Why use someone else’s car to test their tech if they still want to build their own car from the ground up? Apple has been working on this project for years, a lot longer than we ever knew about, we haven’t seen a single thing from them except the picture of the Lexus RX with the steering wheel and pedals in the back seat. There’s no camo’d vehicles rolling around SoCal with people wondering who they belong to.

        If they were even thinking about taking over Tesla why would they even bother developing the tech themselves and waste the cash and time and staff, when Tesla has developed their own and gotten pretty advanced, or if they weren’t going to use Tesla’s already developed tech, why wouldn’t they be using Tesla vehicles to test their tech in?

        All these things point me to this conclusion.

  • Ain’t Gonna Happen

    Yes, but why would Apple ever want to buy Tesla? Apple is quite capable of building any product they want at this point and does not need Tesla. I must rather Apple invest in promising startups versus Tesla.

    • KenjiK

      Well they barely manufacture anything themselves. They just buy companies with tech or stuff they want, or buy it from other tech companies and claim that they made it.

      • Silimarina

        They buy only some parts for their products.For ex. the processors in iphones are designed by Apple but are build by Samsung and TSMC

    • brn

      I disagree about Apple being quite capable of building any product they want. Apple tried building a car and then found out it was a lot more difficult than building a phone, so they (rightfully) gave up.

      If Apple wants to get into the car business, the right way is to buy their way in.

    • Enter Ranting

      Apple can’t build a reliable computer product that lasts longer than a couple years. Everything Apple has produced for the last decade is garbage, dressed up in a pretty wrapper. Feckless Tim Cook is in WAY over his head. It’s easy to make a lot of money when you make everything in China, then hide your profits overseas.

      • rodriguez256

        I have a MacBook Pro from early 2011, it still runs great so I don’t have a need to upgrade any time soon. my iPhone 7 plus has been the best phone I’ve ever owned. So I’d have to disagree with your points.

        • Enter Ranting

          Good for you. Just never update your operating system and maybe you’ll be fine. The problem is, in a few months, you’ll get messages to upgrade your iOS a couple times a day. Rejecting those nagging messages is a MAJOR pain in the ass.

          I have an iPhone 6 that’s a total piece of crap. My new Apple TV never works properly. My new desktop is horribly outmatched by every task I ask of it, and it’s totally un-upgradable, like all new Apple products. My MacBook Pro has been ruined by operating system upgrades. The screen on my old iMac took a crap, rendering the whole computer unusable.

          The reason I have so many Apple products is that I used to swear by them. But they haven’t produced a decent product in ages. It’s all about squeezing the customer base as much as possible and putting form (thinness) and gimmicks over function. Design for design’s sake, and lots of people fall for it.

          I’d kick Apple to the curb if my thousands of dollars worth of software was compatible with another system.

          • rodriguez256

            I update to the new OS every time. I don’t notice any noticeable lag, rather some speed improvements on certain applications. I haven’t done anything to upgrade it beside changing from 8 to 16GB of Ram.

  • haudit

    I don’t think Tesla owners would necessarily want Apple’s ‘Spinning Wheel of Death’™ cluttering up their touchscreen displays.

  • Socarboy

    Elon Musk says he won’t sell….everything has its price

  • Jds65

    Or any other company with enough cash. Brad why do you have such a hard on for Tesla? It’s a great company and all but seriously stop writing Tesla articles over the smallest and speculative things.Do you have wet dreams of Elon too ?

  • Bill O

    Apple probably knows that Elon Musk would walk away from Tesla if they took over and Tim Cook is savvy enough to know that Elon Musk’s influence is a major factor in Tesla’s success. Apple also prefers to farm out their manufacturing and manufacturing is a major part of Tesla’s business.

    Apple would also face a lot of current Tesla employees being very unhappy with a hostile take-over. There is so much competition now for the skills Tesla’s workers have, most could easily walk out of Tesla and find work somewhere else. Apple knows this too because they were aggressively hiring away Tesla talent for a while.

    If Apple really wanted to buy into the automotive business, they should buy a traditional automaker and remake them. Fiat-Chrysler is going to be in deep trouble in a few years. Chrysler is getting by selling the last of the muscle cars, but that’s a limited market that has a shelf life. They also are way behind everyone else in electric vehicles.

    If they wanted a more forward thinking car company, they could buy Ford or GM. Either would cost them less than Tesla.

  • SteersUright

    $250b overseas just to avoid paying taxes back to the very society that you profited off of?? To avoid providing funds for streets, schools, police, and libraries? Apple should be ashamed.

    • Enter Ranting

      Apple has no shame.

  • surfshop

    Tesla should not sell… All Apple’s BS rules will ruin it

  • Erzhik

    In order to buy, the other party has to sell. You can’t buy what is not for sale.

    • Status

      You’ve never heard of a hostile takeover, have you?

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