At present, self-driving technology development is focusing on creating autonomous vehicles for commercial and industrial use. The idea is that a company that can design a working independent driving system AND manufactures it in cars stands to make a lot of money. Argo, however, considers its business model differently. The company, currently partnered with Ford and Volkswagen, is looking at a different incentive for the development of their self-driving technology. Instead of building their own cars, they intend to make money through profit sharing from their car-manufacturing business partner’s inclusion of the company’s tech in new vehicles. The more mileage those cars cover, the more Argo gets paid.
Shirking the Trend
Argo’s main competitors, like Google’s self-driving department Waymo, are heavily focused on developing their own self-driving vehicles. Argo, on the other hand, is aiming for a broader scope of use. Instead of looking solely at consumer transportation, Argo’s design focus is on developing systems that are far more useful to the business world than just robotaxis. Despite this, Argo hasn’t given up on the dream of powering robotaxis themselves. Both VW and Ford would include Argo systems in their version of robotaxis.
Seen as the Underdog
Even though both Ford and VW have faith in Argo, other competitors aren’t so sure that there’s any advantage there that should make them scared. Market valuations for other companies such as Waymo ($105 billion) and Cruise ($19 billion) are massive in comparison to Argo ($7.25 billion). Surprisingly, another big name in autonomous driving, Uber, also has a $7.25 billion valuation. The business is still in its early days, and other competitors have already made strides, so Argo has to play catch up. However, investors and business operators alike are confident that the company can make up the shortfall and even overtake its competitors in short order.