Michigan-headquartered Delphi Automotive PLC and Israeli advanced driver assistance system (ADAS) specialists Mobileye N.V. have announced a collaborative push towards the development of a completely automated driverless solution that is expected to be operational and installed in commercial vehicles by the year 2019.
The joint development venture between the two OEM giants is expected to yield a commercial ready-to-install system for a wide range of passenger vehicles including, SUVs, pickup trucks, and compact cars. As the push towards driverless vehicles gains momentum, the partnership aims to create a significant presence in the supplier market for technology that powers these cars in a business environment that has seen intense competition from manufacturers and technology development firms alike.
For several years, Mobileye and Delphi have carved a niche for themselves in the market as the developers and manufacturers of sensor systems, piecing together the elements of driverless technology systems in adverse market conditions with the development of consumer-assembled technology. However, the partnership has lifted the equity of both companies with Mobileye showing a 8% increase and Delphi recording a modest 3% jump in share values.
A key trend that affects such collaboration is that of automakers outsourcing the manufacturing of parts to third-party suppliers. However, as more core functions such as full-feature driverless systems enter the market, their development is also expected to move away from in-house teams to OEM partnerships or through acquired subsidiaries. General Motors is an example of the latter, having acquired San Francisco-based autonomous vehicle firm Cruise Automation. Ford has also announced a tie-up with several technology and development companies to accelerate the development and eventual production of driverless cars by the year 2021.
In a statement to the press, Kevin Clark, CEO of Delphi Automotive stated that as large auto manufacturers begin to outsource the development of specific elements of their core technologies, the partnership with Mobileye could begin to take on much of the development and production of these large companies. The expected investment from the deal is expected to be in the hundreds of millions of dollars.
Both companies are working towards a full prototype that will possess advanced navigational capabilities on multiple terrains and complex traffic patterns such as roundabouts, joining highway traffic, and lane navigation. Despite their multiple industry relationships with marquee automakers, simulating and responding to situations on the road with the complexity and sophistication of a human driver will require years of development. While the technology is expected to be operational by 2019, commercial production may only follow by 2022.
Amnon Shashua, CTO, and Chairman of Mobileye N.V. stated that the focus is also on creating an intelligent system that is able to handle complex traffic interactions in a real-world situation as a human driver would. The system would seek to avoid creating a system that would result in breakdowns in busy traffic conditions. However, Delphi and Mobileye are working against a rapidly ticking clock with global giants Alphabet Inc. and Volvo announcing pilot tests of their own systems and Nissan and Tesla working towards putting autonomous vehicle systems on the road by 2020.
In the face of such challenges, the system may still appeal to small-to-midsize automakers who may be constrained by research, development and production budgets to fund such technologies on their own. The partnership may be able to use their key client relationships with companies such as BMW and Intel to further progress in the creation of autonomous automobile systems. Companies such as Continental have already acquired the Finnish Elektrobit Automotive Group in order to bolster its own capabilities.
Currently, Mobileye enjoyed a unique position as one of the world’s leading suppliers of semi-autonomous systems for the Tesla Autopilot ADAS system that incorporated camera and sensor-based navigation. However, the relationship with Tesla has since ended due to a difference between the two companies that involved the way in which Mobileye’s systems were deployed. The split occurred in the aftermath of the much-covered crash of one of Tesla’s cars in May 2016. The analyst community has reacted cautiously to the partnership, with Jeremy Carlson from IHS Automotive indicating that automakers may focus on keeping emerging technologies in-house in order to better understand vehicular autonomy before outsourcing it to third parties.
Hamid Moaref has always been fascinated by cars and the automotive industry. His family has a longstanding association with the industry and has been in the tire business for the past 35 years. Raised in Dubai, Hamid attended Capilano University in Vancouver where he graduated with a BBA in marketing before attending an intensive course in magazine publishing in 2005. He has been the publisher and chief editor of Tires & Parts magazine for the past ten years.
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