07 Apr 2017


Mercedes-Benz and Robert Bosch are teaming up to develop self-driving cars in an alliance aimed at accelerating the production of "robo-taxis". The pact between the world's largest maker of premium cars and the world's largest automotive supplier forms a powerful counterweight to new auto industry players like ride-hailing firms Uber and Didi which are also working on self-driving cars.

The alliance not only marks an end to Daimler's efforts to develop an autonomous car largely on its own, but moves the auto industry's ambitions beyond simply developing prototype vehicles towards industrial-scale production of self-driving cars.

Bosch said Mercedes would be able to use the jointly developed system for two years before it could be offered to competitors.

The deal will help the automotive supplier Bosch to make up ground in a competitive autonomous driving system sector where rivals Continental, Delphi, ZF and others have also made heavy investments.

The autonomous system will now be ready by the beginning of next decade, Daimler said, without disclosing when it had first envisaged the commercial launch of automated taxis, or robo-taxis.

The market for advanced driver assistance systems and autonomous vehicles is expected to grow from about $3 billion in 2015 to $96 billion in 2025 and $290 billion in 2035, Goldman Sachs said last year.

Daimler is focusing its efforts on the app-based car-sharing and ride-hailing sector dominated by China's Didi, and U.S.-based Uber [UBER.UL] and Lyft. Like autonomous cars, this market is a big global growth area and is expected to expand by 28 percent a year to 2030, according to consultancy McKinsey.

Before deciding to partner with Bosch, Mercedes-Benz had two engineering teams, totaling about 500 people, working on autonomous vehicles. One took an evolutionary approach, upgrading the capabilities of conventional vehicles, while the other team took a more radical approach to the car's design.


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