ADAS & Autonomous Vehicle Engineering - January 2023 - 3

The Navigator
2022 a mixed bag for the AV sector
The second half of 2022 turned out to be
a mixed bag for the automated-driving sector. The
capital that was flowing so freely from the mid-2010s
onward has largely dried up and the long-expected
consolidation in the sector seems to have begun. One
of the leaders in the segment surprised the industry
when it announced that it was shutting down. Others
have reduced their operations.
For the last decade, investors around the
world have willingly thrown mountains of cash at
AV startups that produce no revenue and show
little prospect of near-term profits. Those investors
suddenly have turned off the taps. As a result,
dozens of companies, including
Aurora Innovation, TuSimple and
Luminar, all of which went public
prematurely in 2020 and 2021, have
seen their valuations collapse by
80-90% or more in the past year.
Meanwhile, others like Mobileye
in Miami, Florida and Austin, Texas. It needed to
raise significant capital to scale its operations as it
approached commercialization.
Ford had already decided that a profitable
robotaxi and delivery business was too far down
the road amid the need to invest $50 billion in
vehicle electrification in the near term. Volkswagen
decided that China, where Argo had no presence,
was a better opportunity and formed a joint venture
there with Horizon Robotics.
With extremely limited revenue, prospects for
and Argo AI waited longer and missed
the window of opportunity to cash in,
as the overall stock market declined
and interest rates increased. Both companies had
plans to go public in 2022 but only Mobileye did
- and at a fraction of the originally expected valuation.
When Intel announced plans for a Mobileye
public offering in December 2021, it was targeting a
valuation of $50 billion to help raise funds for new
chip foundries. By the time of the IPO in October
2022, the valuation was about $16 billion, barely
more than Intel paid for Mobileye in 2017.
Unlike virtually all companies in the automated-driving
sector, Mobileye was at least profitable
thanks to its driver-assistance business, where it is
still the dominant player in vision systems. Argo AI,
which was 80% owned by Ford and Volkswagen,
didn't make it that far. The Pittsburgh-based startup
was just beginning to pilot public robotaxi services
Going forward
we'll likely
see a smaller
but hopefully
more stable
AV sector.
a 2022 IPO were extremely poor and Argo instead
hunted for new private investors. Bloomberg
reported that a potential deal for
Amazon to invest in Argo collapsed
when Ford and VW couldn't reach
an agreement on governance of the
company with Amazon involved.
Rather than go forward, the decision
instead was made to shutter Argo.
While other AV companies
such as Nuro are cutting staff to
save money, the news isn't all bad.
Cruise launched driverless robotaxi services in
San Francisco in June 2022 and by December was
running more than 100 driverless vehicles concurrently.
The GM-backed company announced plans
to add driverless public service in Austin and
Phoenix, Arizona, by the end of 2022 and add
operations in more cities in 2023.
Waymo also is conducting driverless tests in
San Francisco and announced plans to do the same
in Los Angeles. Motional is cutting some staff, but
announced its intent to add robotaxi services in Los
Angeles as part of a multi-city driverless service
launch in 2023.
Going forward, we'll likely see a smaller but
hopefully more stable AV sector as it slowly gains
traction through the remainder of the decade. ■
Sam Abuelsamid
Principal Analyst,
eMobility
Guidehouse Insights
sam.abuelsamid@
guidehouse.com
ADAS & AUTONOMOUS VEHICLE ENGINEERING
January 2023 3

ADAS & Autonomous Vehicle Engineering - January 2023

Table of Contents for the Digital Edition of ADAS & Autonomous Vehicle Engineering - January 2023

ADAS & Autonomous Vehicle Engineering - January 2023 - CVR1
ADAS & Autonomous Vehicle Engineering - January 2023 - CVR2
ADAS & Autonomous Vehicle Engineering - January 2023 - 1
ADAS & Autonomous Vehicle Engineering - January 2023 - 2
ADAS & Autonomous Vehicle Engineering - January 2023 - 3
ADAS & Autonomous Vehicle Engineering - January 2023 - 4
ADAS & Autonomous Vehicle Engineering - January 2023 - 5
ADAS & Autonomous Vehicle Engineering - January 2023 - 6
ADAS & Autonomous Vehicle Engineering - January 2023 - 7
ADAS & Autonomous Vehicle Engineering - January 2023 - 8
ADAS & Autonomous Vehicle Engineering - January 2023 - 9
ADAS & Autonomous Vehicle Engineering - January 2023 - 10
ADAS & Autonomous Vehicle Engineering - January 2023 - 11
ADAS & Autonomous Vehicle Engineering - January 2023 - 12
ADAS & Autonomous Vehicle Engineering - January 2023 - 13
ADAS & Autonomous Vehicle Engineering - January 2023 - 14
ADAS & Autonomous Vehicle Engineering - January 2023 - 15
ADAS & Autonomous Vehicle Engineering - January 2023 - 16
ADAS & Autonomous Vehicle Engineering - January 2023 - 17
ADAS & Autonomous Vehicle Engineering - January 2023 - 18
ADAS & Autonomous Vehicle Engineering - January 2023 - 19
ADAS & Autonomous Vehicle Engineering - January 2023 - 20
ADAS & Autonomous Vehicle Engineering - January 2023 - 21
ADAS & Autonomous Vehicle Engineering - January 2023 - CVR4
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