Hyundai Motor Group said on Monday that it plans to launch a joint venture with Aptiv to develop self-driving automobiles. Hyundai and Aptiv will each have a 50% stake in the joint venture valued at US$4 billion.
Aptiv is a technology company with autonomous driving solutions that include perception systems, software algorithms, computer platforms, data, and power distribution. In a press release, it said it currently “operates more than 100 autonomous vehicles on multiple continents, across a range of driving conditions and environments.”
Amid the trend of forming alliances among global automobile giants and software firms to develop a self-driving vehicle, Hyundai has been slow to forge such a partnership.
Hyundai Motor Group affiliates – Hyundai Motor, Kia Motors, and Hyundai Mobis – will collectively invest $1.6 billion in cash and provide vehicle engineering services, R&D resources, and access to intellectual property worth $400 million.
Aptiv will contribute its self-driving technology, intellectual property, and approximately 700 employees to the development of an autonomous driving solution.
The joint venture deal will be completed next year.
“The new joint venture marks the start of a journey with Aptiv toward our common goal of commercializing autonomous driving,” said Euisun Chung, executive vice chairman of Hyundai Motor Group, in a press release. “The combined capabilities of Aptiv, a leading global technology company, and our Group, a global OEM, will create invaluable synergy to lead the autonomous driving landscape.”
The new joint venture will be led by Karl Iagnemma, the president of Aptiv Autonomous Mobility, which is headquartered in Boston. They will set up technology centers across the United States and Asia, including South Korea. Hyundai Motor Group and Aptiv will appoint an equal number of directors to manage the joint venture.
The joint venture plans to develop software for level 4-5 autonomous vehicle by 2020.
If successfully developed, level 4 vehicles will be able to complete an entire journey with no driver intervention. However, the vehicles will only be able to operate on specific roads and at limited speeds. Level 4 cars will still have a steering wheel and pedals to enable human intervention.
Level 5, the ultimate stage of self-driving development, does not require any human control. A level 5 autonomous vehicle is not constrained at all by geographical conditions and speed limits.
Hyundai has been developing level 4 and 5 self-driving technologies with the aim of commercializing them by 2024.
“Most automobile makers are likely to commercialize level 4 and 5 autonomous vehicles in the mid-2020s to 2030 period, and Hyundai’s commercialization is also expected to fall in the period,” an industry insider told Asia Times. “I expect Hyundai to speed up the commercialization of the self-driving car with this deal.”