Argo AI, the autonomous startup closely aligned with Ford Motor Co., has completed an expected alliance with Volkswagen AG that involves a $ 2.6 billion investment from the German automaker.
VW’s investment includes a $ 1 billion cash injection and the addition of its $ 1.6 billion autonomous intelligent driving unit to Argo. It is part of a broader alliance between VW and Ford to jointly develop autonomous and electric vehicles, a partnership that was first announced last July. The deal puts the world’s first and sixth-largest automakers at the top of a race to launch fully autonomous cars, alongside Alphabet Inc.’s Waymo and General Motors Co.’s Cruise.
With VW’s autonomous entity, Argo will have a global workforce of over 1,000 and a new European outpost in Munich, where it will test its driverless technology, startup CEO Brian Saleski wrote in a blog.
The coronavirus outbreak has delayed Ford’s plan to launch robo-taxis and driverless delivery booths next year. The automaker now says it will start using Argo’s technology in 2022 to have more time to study the impact of the pandemic on consumer attitudes toward autonomous and shared vehicles.
“As long as our companies share the costs of developing Argo AI technology, Ford will remain independent and tremendously competitive,” wrote John Lawler, chief executive officer of Ford’s autonomous vehicle unit, in a separate blog post. “Sharing development costs with Volkswagen does not mean that Ford is reducing its overall spending in the autonomous vehicle space. Instead, we are reallocating the money towards our unique customer experience. “
The head of VW’s commercial vehicles unit welcomed the completion of the deal in a post on LinkedIn.
At VWCom CommercialVehicles we look forward to the development and integration of Level 4 autonomous driving systems into our fleet of light commercial vehicles of the future, ”wrote Thomas Cedran, CEO of VW Commercial Vehicles.
