Ford CEO Farley explains the business factors behind Argo AI’s shuttering
Shortly after news broke Wednesday afternoon that its self-driving subsidiary Argo AI would be wound down, Ford CEO Jim Farley joined in on the company’s Q3 earnings call and spoke at length about how senior management came to that decision. “It’s estimated that more than a hundred billion has been invested in the promise of level four autonomy,” he said during the call, “And yet no one has defined a profitable business model at scale.”
In short, Ford is refocusing its investments away from the longer-term goal of Level 4 autonomy (that’s a vehicle capable of navigating without human intervention though manual control is still an option) for the more immediate short term gains in faster L2+ and L3 autonomy . L2+ is today’s state of the art, think Ford’s BlueCruise or GM’s SuperCruise technologies with hands-free driving along pre-mapped highway routes, L3 is where you get into the vehicle handling all safety-critical functions along those routes, not just steering and lane -keeping.
“Commercialization of L4 autonomy, at scale, is going to take much longer than we previously expected,” Doug Field, chief advanced product development and technology officer at Ford, said during the call. “L2+ and L3 driver assist technologies have a larger addressable customer base, which will allow it to scale more quickly, and profitability.”
“It’s taking that investment and putting it towards a business where we think we will have a sizable return in the near term relative to one that’s going to have a long arc,” he