GENEVA: It could be the battle of the titans.

Auto giants at the Geneva Motor Show say they welcome the potential move of Silicon Valley players into their sector but experts warn of major disruptions.

Google has long made headlines with its plans for a self-driving car, but Apple is now also reportedly readying for a plunge into the industry to begin developing an electric car.

“This could surprise you, but I welcome with open arms the interest of Apple, Google and others in the auto industry,” Volkswagen head Martin Winterkorn said, adding he thought it would help garner interest for cars among new generations who grow up connected.

Fiat-Chrysler chief Sergio Marchionne agreed, saying the Californian giants’ arrival would be “exactly what this industry needed.” Ditto for Renault-Nissan chief executive Carlos Ghosn.

“I’m absolutely not fearful or hostile” towards a possible arrival of Apple, he said at the motor show. “I consider that all the people who join the electric car are some kind of allies.”

Marchionne acknowledged that their arrival would be “disruptive” but argued it would benefit everyone in the long term.

Google and Apple’s interest in vehicles may have got all the industry’s top dogs to react, but many experts doubt that Silicon Valley players actually want to launch into car manufacturing, which yields much lower margins that what they are used to. “If companies like Apple or Google had really wanted to invest in auto production, they could have taken advantage of the crisis to do so,” said Josselin Chabert of consultants PwC.

Published in Dawn, March 6th, 2015

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