Rumors first surfaced in early 2015 that Apple Inc. (NASDAQ: AAPL) was working on Project Titan, the alleged name for an autonomous-vehicle project. At an appearance at Recode's Code Conference in May 2015, Apple Senior VP Jeff Williams then made a provocative statement that set the internet rumor mill ablaze, saying, "The car is the ultimate mobile device, isn't it?" Since then there have been many unverified reports about Apple's work in the field of autonomous driving.

Late last week, the California Department of Motor Vehicles updated its website with the list of companies that had been issued permits to test autonomous vehicles, with Apple being the most recent addition to that list. A DMV spokeswoman confirmed to Business Insider : "Today, April 14, 2017, California Department of Motor Vehicles issued Apple Inc. an autonomous vehicle test permit. The permit covers three vehicles, all 2015 Lexus RX450h, and six drivers."

More info to come?

California also requires permit holders to report disengagements -- a disabling of the self-driving feature -- in two situations: "when a failure of the autonomous technology is detected" or "when the safe operation of the vehicle requires that the autonomous vehicle test driver disengage the autonomous mode and take immediate manual control of the vehicle". These annual reports are then made available for public review and will give Apple shareholders insight into the company's future progress.

This is the latest indication that Apple has its sights get on self-driving cars. Late last year, in a letter to the National Highway Traffic Safety Administration, Steve Kenner, Apple's director of product integrity, said: "Apple uses machine learning to make its products and services smarter, more intuitive, and more personal. The company is investing heavily in the study of machine learning and automation and is excited about the potential of automated systems in many areas, including transportation."

Head start

Alphabet, Inc. 's (NASDAQ: GOOGL) (NASDAQ: GOOG) Google has been testing autonomous-vehicle technology since 2009 and has logged more than 2 million miles, along with 2 billion simulated miles in 2016 alone. The company's moonshot project was recently spun out under the name Waymo, and it's been revealed that the company will manufacture the entire suite of hardware that underlies its autonomous system, including vision systems, radar, and light detection and ranging radar. In December, the company also announced that it was in formal talks to integrate Waymo technology into Honda Motor Co., Ltd. (NYSE: HMC) vehicles.

The number of technology companies and auto manufacturers in the field is ballooning, and Boston Consulting Group estimates that the market for autonomous vehicles could exceed $42 billion by 2025 and $77 billion by 2035, resulting in sales of 12 million fully autonomous and 18 million partially autonomous vehicles annually. Those numbers would represent 25% of the new-car market by 2035.

Don't get excited just yet

Apple has been searching for new sources of revenue, as growth of its flagship iPhone has been slowing in recent years and no single product has emerged to fill the void. The iPhone represented 69% of Apple's revenue in its most recent quarter, or $54 billion of its total $78 billion.

Investors should bear in mind that testing an autonomous vehicle is merely the first in a long series of steps to a marketable product and longer still to one that adds meaningfully to Apple's results, if at all. Nothing says Apple will ultimately be successful with its efforts in the field.

While it will probably be some time before more is revealed about the progress of the company's autonomous driving program, it's good to finally have confirmation that Apple may actually be a player in what will could potentially be a lucrative market.

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