Ford Autonomous Vehicle Plan Targets Mobility as a Service


Archived Published: 24 August 2016 ID: G00315615

Analyst(s):

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Summary

As Ford becomes the latest company to join the autonomous vehicle race, its focus on the mobility services market and partnership with innovative startups may give it a competitive edge.

News Analysis

Event

On 16 August 2016, Ford Motor Company announced it will mass-produce fully autonomous vehicles for mobility service providers by 2021. Ford’s development strategy includes investments in two companies — Velodyne (a producer of lidar sensors) and Civil Maps (a 3D mapping provider). IT also includes the acquisition of SAIPS (a computer vision and machine learning firm), and a licensing agreement with Nirenberg Neuroscience (a machine vision company).

Analysis

Ford plans to develop a vehicle capable of Level 4 automation, as defined by the Society of Automotive Engineers. An automated driving system will monitor the driving environment and perform all aspects of the driving task without the presence of a human driver — thus eliminating the need for a steering wheel or gas and brake pedals. Ford's strategy is to focus on mobility service providers such as ride-sharing, taxi operations and delivery services, where the elimination of a driver can result in a favorable ROI for a fully autonomous vehicle.

Ford's announcement comes less than two months after a similar announcement from BMW, which is partnering with Intel and Mobileye to produce a fully automated driving system by 2021. Through partnerships, Ford hopes to gain access to the key sensing, processing and mapping technologies needed to realize fully autonomous driving. The infusion of capital from Ford and co-investor Baidu will allow Velodyne to accelerate the design and production of affordable, high-performance light, detection and ranging (lidar) sensors — a critical sensing technology for fully autonomous vehicles.

Fully autonomous (Level 4) vehicles will transform the mobility and delivery services business. Uber has invested aggressively in its own autonomous vehicle development program to avoid being rendered obsolete by Google's self-driving car, which has been in development since 2009 and has logged over 1.5 million miles on its fleet of test vehicles. Just two days after the Ford announcement, Uber announced that the first of its self-driving cars — developed in partnership with Volvo — would be put into service in Pittsburgh starting at the end of August. These test vehicles will be supervised by professional drivers, operating in Level 3 mode. Ford's decision to target the mobility and delivery services market with its fully autonomous vehicle makes sense in view of these developments.

The plan outlined by Ford illustrates the fragmented state of autonomous vehicle development, in which automobile manufacturers, large technology providers, chip companies and lesser-known tech innovators are all vying for a seat at the table. The critical capabilities for automated driving cluster around sensing technologies, 3D mapping and data analytics, and algorithms for computer vision, localization and path planning. Until clear leaders and standards begin to emerge in each of these areas, we will continue to see different alliances forming around the autonomous vehicle initiatives of leading car companies. It is also noteworthy that no chip company was named in Ford’s plan, indicating an emphasis on sensing, mapping and algorithmic development rather than silicon.

Recommendations

Automobile manufacturers:

  • Evaluate your product development plans with respect to automated driving capabilities and perform a critical cost-benefit analysis for the target market. Be clear on the minimum level of automation needed to satisfy the market requirement.

Companies providing mobility and delivery services:

  • Develop planning scenarios that include the availability of Level 4 autonomous vehicles as early as 2021, and incorporate the technology into your competitive analysis and investment roadmap for the next decade.

Gartner Recommended Reading

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"BMW, Intel and Mobileye Could Speed Autonomous Vehicle Development"

"Hype Cycle for Automotive Electronics, 2015"

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