October 26, 2022
Ford, during its third-quarter earnings report, said it made a strategic decision to shift its capital spending from the Level 4 advanced driver assistance systems being developed by Argo AI to internally developed L2+/L3 technology, which aligns more with current technology capabilities.
“During the quarter, Ford concluded that the auto industry’s large-scale profitable commercialization of Level 4 advanced driver assistance systems will be further out than originally anticipated – but development and customer enthusiasm for benefits of L2+ and L3 ADAS warrant dialing up the company’s near-term aspirations and commitment in those areas,” Ford said in its earnings press release. The company said Argo AI was unable to attract new investors, resulting in Ford recording a $2.7 billion non-cash, pretax impairment on its investment in Argo, resulting in an $827 million net loss for Q3.
The automaker said in 2017, when it invested in Argo AI and autonomous vehicles, it anticipated being able to bring L4 ADAS technology broadly to market by 2021. “But things have changed, and there’s a huge opportunity right now for Ford to give time – the most valuable commodity in modern life – back to millions of customers while they’re in their vehicles,” said Jim Farley, president and CEO of Ford. “It’s mission-critical for Ford to develop great and differentiated L2+ and L3 applications that at the same time make transportation even safer. We’re optimistic about a future for L4 ADAS, but profitable, fully autonomous vehicles at scale are a long way off and we won’t necessarily have to create that technology ourselves.”
Farley said Ford is expected to hire engineers from Argo AI as the company is “wound down” in order to expand and speed the development of its L2+/L3 systems. The company said more than 83,000 vehicle owners have enrolled in the Ford BlueCruise and Lincoln ActiveGlide services, logging more than 21 million hands-free, L2 miles in just over one year since its launch. By 2028, the company said it expects to have more than 30 million connected vehicles on the road.
Several other companies are continuing to develop autonomous vehicles, including Aurora Innovation, Waymo, and Motional. Others are focusing the technology on long-haul trucking, including Kodiak Robotics, Aurora, Pony.ai, and others. Gatik, for example, is focusing on middle-mile logistics rather than consumer-based autonomous vehicles.
The complete press release by Ford about its third-quarter earnings can be read here.