Apple's plan to enter the auto industry is "a very logical step" as the iPhone maker combines its expertise in software, batteries and design with enormous resources, according to Volkswagen Group CEO Herbert Diess.
"Despite that, we are not scared," Diess said in an interview with Frankfurter Allgemeine Sonntagszeitung.
The car sector is different from the technology industry, and Apple "will not manage to take it over overnight," he said.
Diess dismissed concerns that VW could be degraded to a contract manufacturer for technology firms.
VW plans to develop software needed for autonomous cars in-house to ensure it can compete against tech firms in the field of electric car data.
Cash-rich U.S. and Asian technology giants are plotting inroads into the industry as cars gradually turn into software-intensive self-driving vehicles.
Apple's project to build an electric self-driving vehicle has gained momentum in recent months, adding multiple former Tesla executives and ramping up road tests.
Foxconn Technology Group, Magna International, Hyundai/Kia, Nissan/Renault and Stellantis have been touted as potential manufacturing partners.
Reuters contributed to this report
