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Why Apple could be interested in McLaren
By Rob Hulls • 23/09/2016
Future tie-up possible despite denials
The rumour mill is in full grind after the Financial Times website reported that US tech giant Apple had made an opportunistic approach to take over one of Britain's biggest supercar-makers and second-most successful F1 team in history.
Woking-based McLaren unceremoniously denied the reports last night, with a spokesmen declaring: 'We can confirm that McLaren is not in discussion with Apple in respect of any potential investment.'
But could the two brands tie-up in the future? It's well known that Apple has an electric driverless car project - known as 'Project Titan' - but what else about the British manufacturer could be appealing to the brand better known for the i-phone and Mac?
The carmaker's applied technologies business might be the reason.
The FT reported this week that Apple had approached the eight-time Formula One constructors' champion to negotiate a 'strategic investment' or even a potential buyout.
The supercar builder, under the banner McLaren Automotive, produced 1,654 premium sports cars last year - a record high output for the brand - and recently said it intended to invest £1billion into research and development over the next six years, with speculation that it's next ultra-fast road car will be an all-electric model.
However, the most recent figures released by the firm said it was making a loss. In 2014, McLaren reported revenues of £265million and pre-tax losses of £22.6million.
As a result, the FT said the company could be valued at anything between £1bn and £1.5billion in today's market.
But is it McLaren Automotive and McLaren F1 - the race team - that would be the big attraction to Apple, or could it be another division that's tempting to the Californian gadget giant?
Applied technologies research
That sub-department might be McLaren's Applied Technologies research and development business, which also supplies electronic equipment to other teams in different race series including Formula One and NASCAR in the US. This includes all data analytics that is used to examine race car performance and the surrounding environment to understand where advantages can be made on track.
Not only that, the 250-employee strong department specialises in bespoke materials and aerodynamic design, including lightweight carbon composites and alloys.
The applied technologies arm also develops simulators - like those used by its F1 drivers to practice ahead of race weekends - that can be applied to real-world environments to predict vehicle behaviour in the transport sector. Handy, if you've been working on an autonomous car project for the last two years, like Apple has.
The iPhone-maker has openly been developing a driverless electric vehicle since 2014, but just last month the New York Times reported that the US firm had decided to refocus its operations on the 'underlying systems' that would power such a car rather than built a vehicle entirely.
That means the combination of automotive experience and technological nous of McLaren could be tempting to Apple, which hired former Tesla Cars executive Chris Porritt earlier this year to take command of its special projects division.
Over the last two years, Apple has enrolled a team of engineers and designers to fast-track its autonomous electric vehicle project.
And it further fuelled speculation about its ambitions in the automotive sector earlier in 2016 with a billion-dollar investment in Chinese ride-sharing company Didi Chuxing.
If McLaren does shun approaches from Apple, could the tech brand switch to other targets of similar ilk?
Williams, for example, also has an Advanced Engineering department as part of the Williams Group that's linked to its Formula One team. This wing currently works in the civil aerospace, defence, healthcare, sport science and energy sectors as well as automotive and motorsport.
And like McLaren, it has experience in developing a hybrid road car, after working closely with Jaguar to develop the CX-75 hypercar - the model that didn't go into production but did feature heavily in Spectre, the latest James Bond film, last year.
Currently, McLaren has a triumvirate of owners. Former F1 team principal Ron Dennis - who is now chairman and ceo of McLaren Technology Group and the chairman of McLaren Automotive - and TAG ceo Mansour Ojjeh, both of whom have been invested long-term in the brand.
The final piece in he McLaren puzzle is sovereign wealth fund of the nation of Bahrain, which is the most recent investor.