Ford Authority

Ford Backed Argo AI Reportedly Being Shut Down

In recent years, Ford-backed self-driving commercial vehicle company Argo AI has seemingly made great strides in that particular area, also picking up a massive investment from Volkswagen as part of it and FoMoCo’s partnership agreement from a couple of years ago. In recent months, Argo has announced a delivery services partnership with Walmart, a new test center in South Carolina, safety driver-free rideshare services in Austin and Miami, the fact that it was planning on selling its tech to other companies, and that the upcoming VW ID.Buzz will launch with that technology, too. However, as Ford continues its quest to develop autonomous technology with an eye toward the future, Argo AI recently laid off 150 workers, and now, the company is shutting down altogether, according to TechCrunch.

The company will reportedly be absorbed into both Ford and Volkswagen, though it’s currently unclear how its technology will be divided up between the two. The roughly 2,000 Argo AI employees were reportedly given this news today via a company-wide meeting, at which point they were told that both Ford and VW would be offering positions to select workers. A generous severance package will reportedly be given to all employees consisting of insurance and a pair of bonuses, while those that aren’t retained will receive additional termination and severance pay.

Argo AI was founded back in 2016, and the very next year, Ford announced that it would be investing $1 billion in the company over the course of five years. The company has since raised a total of $2.6 billion from Ford, VW, and various other investors.

In recent years, the autonomous vehicle industry has been ripe with acquisitions and consolidation, though Argo AI has remained one of the more present and visible entities on the road. Now, however, it seems as if the tech it has developed over the past six years or so will be utilized in a different way.

We’ll have more on this as soon as it’s available, so be sure and subscribe to Ford Authority for 24/7 Ford news coverage.

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.

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  1. RWFA

    Ford will integrate some of Argo into its own operations.

    I’m sure we will learn more as to the strategic reasoning here but I see it as:
    – Ford doesn’t want to share this tech with VW anymore or vice versa and want fully proprietary solutions;
    – they realize that there will be 3rd party system suppliers that are further ahead or will catch up with competitive systems (think Bosch, ZF, etc., maybe even Apple.)
    – that the finances aren’t strong enough to fund this technology that won’t ultimately be a core tech or unique selling point and can thus redirect resources to BEV product and product transition efforts;
    – that the tech doesn’t seem like it will be mature enough any time soon do accomplish what is desired (full autonomy) so in this case it is better to be a fast follower.

    1. Njia

      The only (minor) quibble I have with your list of points regards the first bullet. I doubt it’s anything about sharing the tech. More likely, Ford’s relationship with Google (Waymo’s parent) may give them access to the same capability without needing to build it themselves, and continuously pour billions more in capital into the effort for the next several years just to get a product to market. They can let Google fund the development and just source it.

      1. RWFA

        I didn’t mean to sound do absolute on that; I agree this is least likely reason (I didn’t put them in order of likelihood, just as they came into my mind).

        The etc part of the OEM suppliers list was meant to cover aLeo Alphabet but I agree given Ford’s embrace of Android Auto, that a Waymo system would have as good a chance as any (although it might be discouraged by Waymo’s current OEM customers.)

        Reporting is out through other channels and it seems like Ford & VW came to the conclusion hat Level-4 feasibility is more than 5-years off and as you suggest, the costs of recapitalizing the company without finding other partners to bear the load doesn’t make sense.

  2. RWFA

    FWIW, I’m surprised at the size of Ford’s write off of 2.8G$ as their announced 5-year investment plan from IIRC 2017/8-2022 was on the order of 2G$. I think this was before VW chipped in buying an equity share and hen they did their big platform and tech partnership announcement with VW. It seems the write off is ca 50% more than the initial announced investment.

    Would be interested to know if this is correct or not but in any case how it happened to be so large if VW bought part of Ford’s share.

    1. David Dickinson II

      Great point. If Ford is overstating losses to reduce its tax liabilities, then those 82,000 new IRS agents have something to look into.

  3. Richard

    Where would Ford be if they had invested $2+billion in product quality instead? I don’t understand how they can keep throwing money away. This is not the first time or last time.


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