Intel's Acquisition Casts Spotlight on Pioneer in Self-Driving Technology -- Update
March 13 2017 - 02:16PM
Dow Jones News
By John D. Stoll
In the nearly two decades since its founding, Jerusalem-based
Mobileye NV has helped revolutionize two sectors: automotive safety
and Israeli tech.
The firm was created by Amnon Shashua and Ziv Aviram when most
cars counted seat belts, anti lock brakes and air bags as central
safety components. They set out to create vision-based systems that
helped cars see the road and communicate with critical systems --
including steering and braking -- to respond to situations that
could lead to a crash.
Mobileye is now known for its chip-based camera systems that
power automated driving features. A flood of auto makers are
relying on the company's army of engineers to help accelerate the
move to self-driving cars by creating algorithms and affordable
modules that can operate as the eyes, ears and brains of a car that
can pilot itself.
As a result, Mobileye has grown into one of the hottest names in
the autosupply industry and secured a significant portion of the
industry's contracts for technology known as advanced driver
assistance systems, or ADAS. Its ascent helped spur dozens of other
smaller upstart Israeli tech firms to enter a market traditionally
dominated by automotive giants.
Hundreds of models made by dozens of manufacturers world-wide
use Mobileye's technology, or have plans to. Intel Corp. on Monday
said it would buy Mobileye for about $15.3 billion, one of the
biggest acquisitions of an auto supplier in the sector's long
history.
The prevalence of Mobileye systems in today's cars and trucks,
some say, points to the eventual deployment of fully autonomous
vehicles. These systems include lane-departure warning systems,
forward-collision warning, adaptive cruise control and autonomous
braking.
Mobileye is hardly alone in the race to develop these systems.
Delphi Automotive PLC, Sweden's Autoliv Inc., Germany's Robert
Bosch GmbH, ZF Friedrichshafen AG and Continental AG, and Japan's
Denso Corp. are competitors, but some of them are also partners
working to develop complex modules that use Mobileye's
technology.
In an interview last year, Mr. Shashua, Mobileye's chairman and
chief technology officer, said the company secured agreements with
two auto makers to provide systems for fully autonomous cars in
2019. Those deals provided a clearer timetable for when auto makers
believe they can start producing vehicles entirely capable of
driving themselves.
There are many Silicon Valley companies, including Google parent
Alphabet Inc., racing to develop autonomous-vehicle technology.
Most major auto makers have programs that are also devoted to
self-driving cars.
For Israel, Intel's purchase of Mobileye is the biggest tech
deal in the country to date and will likely boost its credentials
as a hub for automotive innovation.
"This [deal] will be a very important impetus to create a whole
industry related to autonomous and connected vehicles," said Yossi
Vardi, considered one of the fathers of Israel's tech industry.
Dozens of Israeli firms are using expertise in cybersecurity,
machine learning and artificial intelligence to create technologies
for the auto industry -- impacting almost every element of the
manufacturing chain, from inventing combustible engines to
quick-charge batteries and suspension systems for wheels.
As a result, vehicle makers such as Ford Motor Co., General
Motors Co. and Daimler AG are all either joining with Israeli
startups, buying stakes in firms or setting up research and
development centers in Israel.
Ford in August said it would buy an Israeli machine learning
company, SAIPS, as it attempts to create a self-driving car for the
road by 2021. General Motors has set up a center on the ground in
Israel and hired Israelis to develop automotive technologies.
Volkswagen AG last year invested $300 million in Tel Aviv-based
startup Gett, which operates an on-demand mobile app that rivals
Uber Technologies Inc. and others. And Google bought traffic app
Waze for more than $1 billion in 2013.
The development of Israeli expertise in the automotive sector is
part of a wider maturation of the tech industry in Israel as more
companies look to grow organically rather than sell as an early
stage startup to larger tech firms, said Avi Hasson, the chief
scientist in Israel's economy ministry.
"Having that strategic outlook is something that I see more and
more happening in the Israeli ecosystem," Mr. Hasson said.
"Mobileye was one of the founders of that."
Write to John D. Stoll at john.stoll@wsj.com
(END) Dow Jones Newswires
March 13, 2017 14:01 ET (18:01 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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