Pittsburgh autonomous vehicle startup Argo AI to shut down

Argo AI LLC, one of Pittsburgh’s most prominent autonomous vehicle startups, is shutting down and is set to be absorbed by its backers — Ford Motor Co. and Volkswagen.

In a statement, Argo confirmed the news following earlier reports that cited unnamed sources who attended a companywide all-hands call Wednesday afternoon where it was announced by executives that the company would shut down.

“In coordination with our shareholders, the decision has been made that Argo AI will not continue on its mission as a company,” the company said in its statement. “Many of the employees will receive an opportunity to continue work on automated driving technology with either Ford or Volkswagen, while employment for others will unfortunately come to an end.”

Argo also shared a statement attributed to its co-founders, CEO Bryan Salesky and President Peter Rander, who launched the company in 2016 after prior experience at other AV companies. Both Salesky and Rander also worked together prior to their AV experiences at the National Robotics Engineering Center, part of Carnegie Mellon University’s Robotics Institute.

“We are incredibly grateful for the dedication of the Argo AI team, and so proud of our achievements together,” the statement from Salesky and Rander said. “The team consistently delivered above and beyond, and we expect to see success for everyone in whatever comes next, including the opportunities presented by Ford and VW to continue their work on automated driving technology.”

The company did not offer any further details, and an Argo spokesperson couldn’t be reached to offer more details as of publication.

Ford and VW had invested over $1 billion into the Strip District-based startup over the past few years. The two companies will now split the remains of the company and its workforce.

In its third-quarter investor’s letter shared during Ford’s earnings call on Wednesday, the automaker said Argo had failed to attract new investors after Ford decided to shift its investments earlier this year from advanced L4 automated driver tech made by Argo to internally developed and less advanced L2 and L3 driver-assistance technology. Ford reported a $2.7 billion non-cash, pretax impairment on its investment in Argo, leading to an $827 million net loss for Q3.

“It’s mission-critical for Ford to develop great and differentiated L2+ and L3 applications that at the same time make transportation even safer,” Ford CEO Jim Farley said in the letter. “We’re optimistic about a future for L4 ADAS [Advanced Driver Assistance Systems], but profitable, fully autonomous vehicles at scale are a long way off and we won’t necessarily have to create that technology ourselves.”

The letter then stated that Ford will go on to hire “talented engineers” from Argo as the company is wound down as part of Ford’s effort “to expand and speed development” of these automated driving technologies.

As for Volkswagen, the German automaker offered few details on its relationship with Argo other than noting it will no longer be investing into the company and that it will work to recruit some of its workers.

“Volkswagen is working with Argo AI to provide continued employment for employees and to further develop the most promising projects in the field of autonomous driving,” the company said in a statement.

Argo has an employee count of 1,800 globally, about 800 of whom are based in Pittsburgh. Those figures are after the July 2022 layoffs that the company issued, which impacted about 5% of its workforce.

It’s unclear how Argo’s operations in Pittsburgh will be impacted by the decision. The company ranks as one of Pittsburgh’s largest Robotics/AI companies. It occupies most of the 130,500-square-foot Riverfront West building on Railroad Street in the Strip District, a building it recently expanded in this past April. Argo also has other outposts scattered across the region, including a test track facility in Westmoreland County.

Source: www.bizjournals.com