Last week a report surfaced suggesting that Apple met with Tesla CEO Elon Musk in some fashion. The rumor immediately sparked discussions that Apple, with plenty of cash on hand, was interested in buying the automaker. In an interview with Bloomberg following the company's Q4 2013 earnings last night, Tesla CEO Elon Musk confirmed that he did meet with Apple.
"We had conversations with Apple," he told Bloomberg. "I can't comment on whether those revolved around any acquisition." The late Steve Jobs had discussed his interest in changing the auto industry and even said that he wanted to create a car at some point. It seems natural, then, that Apple might still be interested in entering the space and acquiring a company that, like Apple, is at the forefront of its industry. Bloomberg asked if Musk was shopping Tesla for a potential buyer.
"I think that's very unlikely because we need to stay super focused on achieving a compelling – creating a compelling mass market electric car," Musk said. "And I'd be very concerned in any kind of acquisition scenario, whoever it is, that'd become distracted from that – from that task which has always been the – the driving tool of Tesla." Musk didn't say yes, but he also didn't say no and, as the Financial Post notes, he merely said such a transaction is "unlikely."
Meanwhile, Apple is already ready to enter the automobile space in a big way, through iOS in the Car, which is expected to make its debut in iOS 7 this spring. It will provide a separate and interactive user interface on a car's dashboard that links directly to an iPhone. The meetings could have revolved around Apple powering the software inside of Tesla's cars, which is currently powered by Linux. Other reports have suggested the two companies met to discuss battery technology, too.
It is clear, however, that Musk and Apple didn't just meet for the fun of it. These were high level talks, and Wall Street has been watching to see where Apple ultimately starts to spend its cash. The company has promised to enter new industries, and a Tesla acquisition would be a huge and groundbreaking splash – giving Apple a whole new battlefront, and creating a new area for growth in the U.S., where it flatlined last quarter.