The iPhone maker is being sued by a lithium-ion battery maker for electric cars and other sectors, A123, for what is alleged as an aggressive campaign of poaching the firm’s employees. It was earlier this week in Massachusetts that the complaint was filed in which five employees have been named, who, either are working to recruit other employees to Apple or have defected to the US technology giant. It is believed by A123 that Apple Inc. has the intention of building a rival battery business because of which it needs to rely, at least partially, on the expertise of employees of A123, in order to be successful.
No comment was made by Apple Inc. regarding the lawsuit and A123 didn’t make any statement either. There was once a time when A123 had been a very promising player in the field of electric vehicles and had received backing from government in the form of a $250 million grant. However, it was in 2012 that the company made a filing for bankruptcy protection amidst high development costs, slower than expected advances in battery and slow acceptance of electric cars amongst the consumers. According to the battery maker, the efforts of the smartphone giant could threaten the business of the company as it would have to scramble to find qualified replacements.
This would leave A123 vulnerable, especially after the restructuring efforts it has made. Apple Inc. has also hired talent from the auto industry, including people from Tesla Motors Inc. and Daimler’s AG Mercedes-Benz unit. This suit comes up on the iPhone maker as the company is set to challenge General Motors Co, Tesla Motors Inc. and other automakers by developing an electric vehicle. Several hundred employees of the Cupertino, California based firm are working on a secret project that has been given the code name of ‘Titan’.
Apple and the Car Making Industry
As per the reports circulating the market, it includes the initial design work on a vehicle that bears a string resemblance to a minivan. But, the effort of the company may not necessarily lead it to producing an automobile. General Motors retired chief executive, Dan Akerson has said that it isn’t a good idea for Apple Inc. to venture in the car making industry. The company could think about making automobile electronics, but car-making itself would not be a good decision. This is due to the fact that there are plenty of regulatory and safety requirements involved, which aren’t that easy to understand and comply with.
He said that it would be more profitable for the firm to team up with automakers for producing entertainment equipment and electronic operating systems rather than going into hardcore car manufacturing as it wouldn’t be able to provide the profits that the company is used to getting from its iPhones and iPads. Apple has enjoyed huge profits in the quarter ended in December thanks to its large-screen iPhones that it introduced in September. A123 has its operations in Massachusetts, Michigan, China and Germany and is also a subsidiary of the Wanxiang Group of China.