Apple Inc. may already be positioned to evolve into a global automaker in many ways that other Silicon Valley companies aren’t.

 

The Cupertino, California-based tech company has put a few hundred employees to work on a secretive project to develop an electric vehicle, a person familiar with the matter has said. While Apple often tests ideas that don’t get released, the work underscores the company’s long-held desire to play a greater role in the automotive space, which is ripe for more of a merging with users’ digital lives.

 

“It makes a ton of sense,” Gene Munster, an analyst with Piper Jaffray Cos., said Saturday in an interview. “If you would’ve said 10 years ago, ‘Apple is going to be in the car business,’ I think people would’ve said you’re crazy -- because it would’ve been crazy -- and today it’s a much different company that’s able to tackle these massive addressable markets.”

 

Apple, with a market capitalization that’s more than $700 billion, needs to continue growing sales in iPhones, its largest revenue generator, while also expanding into new markets, such as automobiles, if it’s to reach a $1 trillion valuation, Munster said. He added that he doesn’t think Apple would bring out a car in the next five years

 

Nonetheless, Apple boasts some advantages versus other Silicon Valley companies with car ambitions. Tesla Motors Inc., which delivers less than 10,000 vehicles a quarter, surprised investors last month when Chief Executive Officer Elon Musk said the company wouldn't be profitable until 2020.