Autonomous vehicle company Motional is facing a setback as one of its primary backers, automotive supplier Aptiv, announced that it will no longer allocate capital towards the commercialization of a robotaxi service in 2024. This decision comes as a surprise and raises questions about the future of Motional’s ambitious plans.
Key Takeaway
Motional faces a significant setback as Aptiv, one of its primary backers, withdraws capital support for the commercialization of a robotaxi service. Despite this challenge, Motional remains determined to pursue its funding roadmap and advance its efforts towards scaling driverless services.
Aptiv’s Decision
Aptiv Chairman and CEO Kevin Clark stated during the company’s fourth-quarter earnings call that they have decided to pursue alternatives to reduce their ownership interest in Motional. The high costs associated with delivering the necessary technology for a robotaxi service have led Aptiv to reconsider its capital allocation. The company is exploring steps to reduce a significant portion of its common equity while working within the construct of the joint venture agreement.
Motional’s Response
Despite Aptiv’s decision, Motional remains confident in its funding roadmap and is determined to proceed with the next phase of commercialization. The company emphasized its strategic partnerships with shareholders, including Aptiv and the Hyundai Motor Group, and expressed its commitment to scaling driverless services and expanding commercial partnerships.
Motional’s Journey
Motional’s roots can be traced back to nuTonomy, a Boston-based autonomous vehicle startup founded in 2013. Following its acquisition by Delphi in 2017, nuTonomy became part of Aptiv, which later formed the joint venture with Hyundai to create Motional. The joint venture aimed to leverage combined investments to develop and commercialize self-driving cars, with ambitious targets that have since been adjusted in response to industry developments.
Commercialization Efforts
Despite the challenges, Motional has made progress towards its goal of launching a robotaxi service using driverless vehicles. Collaborative efforts with Hyundai Motor Group and plans to co-develop production-ready autonomous vehicles demonstrate the company’s commitment to advancing its technology. Motional is actively testing its autonomous vehicles in multiple cities and has announced plans to work with Kia on a next-generation vehicle for future commercial operations.
