Ford bets $1 billion on startup to hasten work on driverless cars
SAN FRANCISCO — Ford Motor is spending $1 billion to take over a budding robotics startup to acquire more expertise needed to reach its ambitious goal of having a fully driverless vehicle on the road by 2021.
The big bet announced Friday comes a few months after the Pittsburgh startup, Argo AI, was created by two alumni of Carnegie Mellon University’s robotics program, Bryan Salesky and Peter Rander.
The alliance between Argo and Ford is the latest to combine the spunk and dexterity of a technologically savvy startup with the financial muscle and manufacturing know-how of a major automaker in the race to develop autonomous vehicles. Last year rival General Motors paid $581 million to buy Cruise Automation, a 40-person software company that is testing vehicles in San Francisco.
The Argo deal marks the next step in Ford’s journey toward building a vehicle without a steering wheel or brake pedal by 2021 — a vision that CEO Mark Fields laid out last summer.
The big-ticket deal for the newly minted company clearly was aimed at getting Salesky and Rande. Salesky formerly worked on self-driving cars at a high-profile project within Google — now known as Waymo — and Rander did the same kind of engineering at ride-hailing service Uber before they teamed up to launch Argo last year.
The two will develop the core technology of Ford’s autonomous vehicle — the “virtual driver” system, which is described as the car’s “brains, eyes, ears and senses.”
The decision to turn to Argo for help is a tacit acknowledgement that Ford needed more talent to deliver on Fields’ 2021 promise, one expert familiar with Salesky and Rande said.
“This is likely a realization that Ford is behind relative to companies like GM, Audi, Volvo, Waymo and Uber, and is trying to catch up,” said Raj Rajkumar, a Carnegie Mellon computer engineering professor who leads the school’s autonomous vehicle research.
By joining with Ford, Argo gets strong capital backing and expertise on other components needed to run autonomous cars, as well as product development and manufacturing knowledge, Salesky said. In return for its funding, Argo will design its driverless system exclusively for Ford and then have a chance to license the technology to other automakers.