Why Tesla is the spark that Apple needs

Applesdismal earnings announcementshows why it badly needs to rethink its innovation model and leadership. Its last breakthrough innovation was the iPhone which was released in 2007. Since then, Apple has simply been tweaking its componentry, adding faster processors and more advanced sensors, and playing with its size making it bigger in the iPad and smaller in the Apple Watch. Chief executive Tim Cook is probably one of the most competent operations executives in the industry but is clearly not a technology visionary. Apple needs another Steve Jobs to reinvent itself otherwise it will join the ranks of HP and Compaq.

That Steve Jobs may be Elon Muskwho has proven to be the greatest visionary of our times.

In the same period that Apple released the iPhone and successors, Musk developed two generations of world-changing electric vehicles; perfected a new generation of battery technologies; and released first-generation autonomous driving capabilities. And that was in Tesla Motors. In his other company, SpaceX, Musk developed a spacaecraft, docked it with the International Space Station, andreturned with cargo. Hes launched two rockets to space that have made vertical landings back on Earth one on a helicopter-like pad and another on a ship in the ocean. Musk is also developing the Hyperloop, a high-speed transportation system in which pressurized capsules ride on an air cushion driven by linear induction motors and air compressors.In discussions thatI had with him in 2012, Musk told me that his ambition was to build a space station and retire on Mars. He wasnt joking, I expect he will do this.

Apple has reportedly been developing an electric vehicle because it sees a car as an iPhone on wheels. It is conceivable that it will demonstrate something like this in the next five to 10 years. But Tesla already has this technology and it is amazing. Ihave likenedmy Tesla Model S to a spaceship that travels on land. I consider it to be better than any Apple product because it is more complex, elegant, and better designed than anything that Apple offers.

Apple should buy Tesla and appoint Musk as CEO.

Would Musk be interested in being part of Apple when Tesla is on top of the world? Tesla just received nearly $20 billion in orders for its Model 3 a record for any product in history. Muskreportedlyturned down an acquisition offer from Google in 2013 when it was on the verge of bankruptcy. Why would he consider such an offer now, from Apple?

My guess is that he would do this if he were offered the chief executive role. A combination of an operations executive such asCook and a visionary such asMusk would be formidable. Apples vast resources would allow Tesla to scale up his operations to deliver the nearly 400,000 orders it has received for the Model 3. Tesla would be able to leverage Apples global distribution network and incorporate many new technologies. Musk would be able to pursue his dream projects while Cook worried about delivery and detail.

And Cook would get the visionary that Apple badly needs, someone who is even a cut above Steve Jobs. The markets would rejoice and take Apple stock to a level higher than anything it has seen before. Consider that Teslas market cap of $33 billion is eminently affordable by Apple, which has reserves of more than $200 billion. And Apple lost $47 billion in valuation with its earnings announcement Tuesday,which is more than it would likely cost to acquire Tesla.

This could be a marriage made in heaven. We would get world changing innovations as well as our space colonies.

Below is an interview I did with Tyler Mathisenof CNBC Power Lunch about this.
Vivek Wadhwa: Apple should buy Tesla and make Elon Musk CEO

About Author

Vivek Wadhwa is Vice President of Innovation and Research at Singularity University; Fellow, Arthur & Toni Rembe Rock Center for Corporate Governance, Stanford University; Director of Research at the Center for Entrepreneurship and Research Commercialization at the Pratt School of Engineering, Duke University; and distinguished visiting scholar, Halle Institute of Global Learning, Emory University. He is author of ”The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial Talent”–which was named by The Economist as a Book of the Year of 2012. Wadhwa oversees the academic programs at Singularity University, which educates a select group of leaders about the exponentially growing technologies that are soon going to change our world. These advances—in fields such as robotics, A.I., computing, synthetic biology, 3D printing, medicine, and nanomaterials—are making it possible for small teams to do what was once possible only for governments and large corporations to do: solve the grand challenges in education, water, food, shelter, health, and security.

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