Employee takeover offers by Ford and/or Volkswagen
Argo employees have been told some of them will be getting offers from both automakers, TechCrunch said, adding it’s unclear how many employees will go to Ford or Volkswagen or lose their jobs. .
“In coordination with our shareholders, the decision has been made that Argo AI will not continue its mission as a company. Many employees will have the option of continuing to work on automated driving technology with Ford or Volkswagen, while employment for others will unfortunately end,” Argo said in a statement.
The employees were told they would receive a severance package including insurance and two separate bonuses – an annual award plus a transaction bonus upon completion of the deal with Ford and VW. All Argo employees will receive them. For those not retained by Ford or VW, they will additionally receive severance pay, including health insurance.
Layoffs already in July
Last July, Argo AI said it laid off about 150 employees, saying it was making adjustments to its business plans. The company still had more than 2,000 employees worldwide after the job cuts.
$3.6 billion in investments
Launched in 2016, Pittsburgh-based Argo AI was making developments around self-driving technology. The company had raised at least $3.6 billion in investments, mostly from Ford and Volkswagen.
Ford: autonomous driving in, autonomous vehicle out
Ford said in its third-quarter earnings report released Wednesday that it had made a strategic decision to redirect its resources to the development of advanced driver assistance systems, and to cut back on autonomous vehicle technology. that can be applied to robotaxis.
The automaker said it recorded a pretax non-cash writedown of $2.7 billion on its investment in Argo AI, resulting in a net loss of $827 million for the third quarter.
Buy technology rather than develop it
This decision appears to have been motivated by Argo’s inability to attract new investors. Ford CEO Jim Farley acknowledged that the company initially planned to be able to widely commercialize autonomous vehicle technology by 2021.
“But things have changed, and now there’s a huge opportunity for Ford to give back time – the most precious commodity in modern life – to millions of customers while they’re in their vehicles,” Farley said. “It is essential for Ford to develop high-performance and differentiated L2+ and L3 applications which, at the same time, make transport even safer,” he added.
Farley also hinted that Ford would be able to buy self-driving technology across the chain, instead of developing it in-house. “We are optimistic about the future of L4 ADAS, but large-scale, cost-effective, fully autonomous vehicles are still a long way off and we won’t necessarily have to create this technology ourselves,” the executive added.
Our opinion, by leblogauto.com
The dream of an autonomous vehicle seems to be slipping away little by little, particularly given the significant investments that this entails. Not to mention the technological or even legal difficulties. Manufacturers like Ford are now focusing on self-driving features and buying technology more than in-house developments.
Sources: TechCrunch, Ford