A rapidly expanding Pittsburgh-based self-driving development firm is a key component of the “coopetition” alliance formed by Volkswagen and Ford to bring an autonomous electric vehicle platform into the worldwide automotive mainstream.
Established in the Steel City with just three employees in November of 2016, Argo AI hired its 500th worker this-past July while receiving a $2.6 billion infusion from VW to augment a previous $1 billion investment from Ford.
With Argo AI engineers at the controls, Ford and VW executives are collaborating – or rather cooperating while competing as in “coopetition” — on producing a series of practical and cost-effective EV innovations.
|A Ford and VW EV in an Argo lab.||A Ford and VW EV on the road.|
“While Ford and Volkswagen remain independent and fiercely competitive in the marketplace, teaming up and working with Argo AI on this important technology allows us to deliver unmatched capability, scale and geographic reach,” says Ford President and CEO Jim Hackett. “Unlocking the synergies across a range of areas allows us to showcase the power of our global alliance in this era of smart vehicles for a smart world.”
These electrifying technologies will be commonplace within a decade, according to a Credit Suisse Bank analysis conducted by Bin Li, the founder, chairman and CEO of NIO, a Chinese EV manufacturer. “It took 20 years for smartphones to replace mobile phones, which replaced landline phones in the first place. I can imagine that in another 10 years, the only word we’ll use when we talk about cars would probably be ‘Smart EV,’” says Li.
“However, despite the favorable environment, there are two main challenges EV producers have to face: charging and marketing. Charging must be fast and easy and EVs need to be able to drive long distances,” Li continues. “As for marketing, the public must become aware of the advantages of EVs over their gasoline counterparts. Today, most people simply default to traditional cars.”
Under the agreement with Ford and VW, Argo is perfecting a production-quality self-driving system to be separately incorporated by the two automakers. Called SDS, it consists of the software, sensors and computing power necessary for self-driving capability.
Ford will additionally be utilizing VW’s EV architecture and its cutting-edge Modular Electric Toolkit (MEB) to design and build a high-volume fully electric vehicle for European distribution starting in 2023. Expecting to sell more than 600,000 MEB-equipped EVs in Europe over six years, a second all-new Ford EV release for the European market is under discussion.
“Looking ahead, even more customers and the environment will benefit from Volkswagen’s industry-leading EV architecture,” says VW CEO Dr. Herbert Diess. “Our global alliance is beginning to demonstrate even greater promise, and we are continuing to look at other areas on which we might collaborate.”
|From left: Ford President and CEO Jim Hackett; Bryan Salesky, CEO of Argo AI; and VW CEO Dr. Herbert Diess||Vintage VW vans with Argo AI technology|
Diess observes that “this improves the positions of both companies through greater capital efficiency, further growth and improved competitiveness; scaling our MEB drives-down development costs for zero-emissions vehicles, allowing for a broader and faster global adoption of electric vehicles.”
The alliance, which additionally covers collaborations outside of the joint VW and Ford investments in Argo, does not entail cross-ownership between the two companies and is independent from the Argo arrangement. A joint committee led by Hackett and Diess and staffed by senior executives from both automakers governs the agreement. The companies also are on track to deliver medium-duty pickup trucks for global customers, aiming to start in 2022, followed by commercial vans.
Navigating the grid
Volkswagen’s existing EV-focused Autonomous Intelligent Driving (AID) division, which includes more than 200 employees, is becoming a part of Argo. Based in Munich, Germany, AID will serve as Argo’s new European headquarters with AID’s current CEO Karlheinz Wurm remaining in charge. With the addition of the AID workers, Argo is growing from 500 employees to an international staff of 700 people.
“Argo AI is fortunate to have a world-class team due to our clear mission and the commitment to deployment from our partners, and together with AID employees, we will have a global workforce to attract even more of the best talent,” says Argo co-founder Bryan Salesky, pleased that the company is now valued at more than $7 billion. “Plus, thanks to Ford and Volkswagen, Argo AI technology could one day reach nearly every market in North America and Europe, applied across multiple brands and to a multitude of vehicle architectures.”
Citing Ford and VW’s product development and manufacturing teams accounting for more than a century of automotive engineering expertise, “With their footprint, our SDS is the first with commercial deployment plans for Europe and the U.S., and has the largest geographic deployment potential of any self-driving technology to date,” Salesky points out.
“We are actively seeking partnerships with automakers, mobility service providers and key players in the transportation sector,” he adds. “We place an extremely high importance on finding the right fit and remain open to additional investments.”
Currently under development and continually being refined, Argo’s EV car is being tested on public roads in Pittsburgh; Washington, DC; Miami, Detroit; and Palo Alto, Calif.
Palo Alto’s hipster college-town grid features every imaginable obstacle to autonomous navigation, including unicycles. With Washington, “Our nation’s capital has some of the worst traffic congestion in America, and a very complex street layout,” according to Salesky, and in Miami “local drivers come from all over the world -- each one brings different driving habits that make this one of the most diverse cities to test in.”
Salesky’s Pittsburgh travelogue emphasizes how the “steep and narrow streets snake over hills, under railroad tracks, through tunnels and across bridges, making it one of the most challenging environments in America. And that’s before it snows.”
Buzzing over EVs
As VW and Ford forge ahead with the latest in EV development, it should be noted that this is not their first foray into automotive electrification.
Henry Ford was always tinkering with his friend Tom, Thomas Edison, and in 1913 the duo applied Edison’s batteries to invent the electrically powered Edison-Ford runabout. Unfortunately, an early version of range anxiety brought on by technological battery limitations led to the project’s demise, but not until Ford had invested $1.5 million and bought nearly 100,000 of Edison’s batteries.
And even earlier, in 1898 a 23-year-old from Austria-Hungary named Ferdinand Porsche joined with Jacob Lohner to create a mixed-hybrid Lohner-Porsche Electromobile. It performed quite well but was costly to produce. During a 1900 endurance race under exceptionally unpleasant rainy conditions Porsche caught a terrible cold – bad enough to make him lose interest in EVs and instead pursue his idea for a beetle-shaped internal combustion people’s car.
VW never did totally lose interest in EVs, as it is gearing up to manufacture MEB-platform vehicles on three continents: Europe, China and at its sprawling plant in Chattanooga, Tenn. The compact ID. will be produced in Chattanooga along with the ID. CROZZ SUV. Production is to eventually include the ID. BUZZ, a van that mimics the legendary Microbus.
By 2022, VW executives say they plan to be operating eight worldwide MEB plants.