Daimler and Bosch have joined the growing list of carmakers and tech firms teaming up to develop self-driving cars and capture their share of the market.
The accelerated competition to put autonomous vehicles on the road has prompted a shift in strategy among automakers. Rather than gradually building on driver assistance systems, a growing number are experimenting with new car designs. And, as software becomes increasingly enmeshed in product development, many are forming alliances with technology companies. The market for autonomous vehicles, and the advanced driver assistance systems they rely on, is expected to grow to $96 billion in 2025 and $290 billion in 2035, according to Goldman Sachs.
Technology companies and carmakers are also adapting to a new automotive ecosystem in which consumers increasingly use smartphones to hail rides rather than buying cars. Like autonomous cars, the app-based car-sharing and ride-hailing sector, currently dominated by China’s Didi and US-based Uber and Lyft, is a big global growth area. It is expected to expand by 28% a year to 2030, McKinsey estimates.
With this in mind, the alliance between Daimler and Bosch is focused on so-called robo-taxis. “Within a specified area of town, customers will be able to order an automated shared car via their smartphone. The vehicle will then make its way autonomously to the user”, a spokesperson for Daimler said. “The idea behind it is that the vehicle should come to the driver rather than the other way round.”
Bosch is already one of the world’s largest suppliers of advanced driver assistance systems, Reuters notes, while Daimler is the world’s largest maker of premium cars. Bosch’s main role will be to work with Daimler to develop software and algorithms for autonomous driving. This will help Bosch catch up with rivals such as Continental, Delphi and ZF in the autonomous driving system sector.
For Daimler, the deal marks an end to its earlier efforts to develop an autonomous car on its own. It will allow the carmaker to put more engineering talent and other resources into autonomous cars and reach its goal years earlier. “The prime objective of the project is to achieve the production-ready development of a driving system which will allow cars to drive fully autonomously in the city”, the company said in a statement.
The Daimler-Bosch alliance also offers further evidence that the automotive industry’s ambitions have moved beyond simply developing self-driving cars to launching mass production.