It appears that a presumed rough patch in Ford and Volkswagen’s relationship is over, now that The Wall Street Journal is reporting on VW preparing a nearly $2-billion investment into the Blue Oval’s autonomous development unit, Argo AI.
Earlier this month, claims arose that negotiations had reached an uncomfortable crossroad, with Volkswagen balking at Ford’s proposed admittance fee. Under the new deal, VW would set aside $600 million as an equity investment into Argo — acquiring half of the business in the process — followed by subsequent investments totaling $1.1 billion for the subsidiary’s research and development efforts.
The duo officially announced the beginnings of a “global alliance” earlier this year, focusing on the joint production of midsize pickups and commercial vans intended for for overseas markets. However, Ford and VW were also said to be in discussions over how to best collaborate on electric and autonomous vehicles. The presiding assumption had been that Volkswagen would make a good faith investment into Argo before Ford tried something similar to procure access to the German’s battery technology — potentially licensing itself VW’s modular EV architecture in the future.
As of now, Argo is a bit of a money pit. Ford poured $1 billion into the firm back in 2016 and lost nearly $674 million through Ford Smart Mobility in 2018. While automakers believe that mobility investments will pay off down the line, the cost of entry has proven to be rather high. By cooperating, VW and Ford can drastically soften the financial burden of their lofty technological goals — much like Honda did when it agreed to invest $2.75 billion into General Motors’ Cruise AV.
Bloomberg previously reported that the automakers discussed an approximate valuation for Argo of roughly $4 billion. While neither company confirmed this (or the $1.7-billion VW investment), both say discussions are ongoing. Ford said it will issue an announcement if any formal agreement is reached.
[Image: Argo AI]
Electric vehicles? – great, bring it on. More infrastructure please.
Mobility? Subscriptions? – About as interesting as public buses.
“Report: VW to Invest $1.7 Billion Into Ford’s Autonomous Arm”
Ford and his arm are really happy about that:
http://i.ndtvimg.com/i/2015-07/harrison-ford_640x480_71436764353.jpg
Something about the concept of a German “autonomous arm” unsettles me…
https://lobelog.com/wp-content/uploads/Dr_strangelove_peter_sellers.jpg
For those who haven’t seen the film, that’s “Doctor Strangelove”.
This may be Ford’s secret plan to destroy VW $1 billion at a time.
Argo is local to me in the Pittsburgh area. Frankly, a $4 billion valuation is lunacy. They’ve gone from 3 (yes, three) employees in 2016 to 300 a year ago. This means they’re simply a money pit that is hiring brains as fast as they can. It does not mean they are viable, and it does not mean they’ve solved the real-life problems of autonomous driving, not the least of which are the liability issues.
https://www.argo.ai/our-mission/
Uber also has its well-known Advanced Technologies Group here, also.
These companies are trying to attract the B&B from the area to work for them. IMO, anyone making that jump is looking at a future of endless hours and eventual layoff.
For kicks, I read the job list and some of the job descriptions on the “Join Us” page. The sheer number and seniority of the open positions gives me pause. Like, your company is worth $4B, but you still need a “Lead Software Engineer, Detection”, “Technical Program Manager, Perception”, and several hardware and firmware engineers?
Also the thought of spending a lot of money “creating high definition 3D maps” is a little unsettling. The vehicles are supposed to be able to navigate new situations. If they need pre-developed 3D maps to do this safely, then it goes right back to an inadequate solution to the core problem of self-driving. Do you want to be the beta tester for a certain section of road that hasn’t been LiDAR mapped yet?
I wouldn’t consider joining without some kind of cash-convertible ownership stake that would be vested and convertible, like, “soon”.
Impressive – it is 1000% growth in just 3 years! You should buy their shares.
I was thinking about Ford’s exoskeleton.
https://browse.startpage.com/do/show_picture.pl?l=english&rais=1&oiu=https%3A%2F%2Fzdnet1.cbsistatic.com%2Fhub%2Fi%2Fr%2F2018%2F08%2F07%2Fc1f71132-d6b0-4540-a0bd-ae28da9e057b%2Fresize%2F770xauto%2Fa5734761de7a9e8b8ab0ed506d03c9ad%2Fscreen-shot-2018-08-07-at-09-54-41.jpg&sp=e03b4f84838e846b0f233d099d8522ce&rl=vd&t=default
I read Elizabeth Holmes is looking for a sinecure. Snake oil is her forte.
And wearing black turtlenecks.
About the arm
youtube.com/watch?v=b5PIeYcZG0g
A car about to drive into a building? I’d classify that as a failure.