How Autonomous Driving Is Accelerating Towards Its Own ChatGPT Moment

There’s no denying that the autonomous driving industry has hit more than a few speed bumps of late. Earlier this year, the sector witnessed one of the most high-profile failures we can ever remember seeing in tech: the abrupt shutdown of Project Titan, Apple’s long-gestating, much-whispered-about self-driving car project.

Back in 2015, Apple COO Jeff Williams set tongues wagging when he described the car as the “ultimate mobile device”. Yet, despite tantalising rumours of high-level meetings with legacy OEMs, thousands of Apple staff being brought onto the programme, and at least 450,000 miles of autonomous driving testing logged, the almost decade-long project was unceremoniously junked in February.

That same month, it was reported that General Motors’ self-driving car subsidiary Cruise had seen its internal share price cut by more than half since the previous quarter. The plummeting valuation was to be expected, given that Cruise – which was the first company to operate a commercial, driverless ride-hail service in a major US city – had recalled its entire fleet after a pedestrian was hit and dragged along the road by a Cruise robotaxi in October 2023. (GM later reached a settlement worth between $8 million and $12 million with the pedestrian.)

But, while such stories have undoubtedly shaken confidence in the sector, there are nuances to consider. For example, copious analysis of Project Titan has revealed the demise of the programme was due more to uncharacteristically scattershot decision making at Apple, than to wider challenges affecting the autonomous driving industry as a whole.

Sources suggest there was a lack of clarity of purpose at the tech giant, with widespread confusion among staff regarding the direction of the project and the company reportedly pivoting back and forth between wanting to create its own car and focusing solely on driving software. Their ambitions may also have been too lofty, even for a behemoth like Apple. As a Bloombergreport put it, the idea of a non-car company attempting to suddenly “change the world with a full-blown self-driving vehicle” amounted to a grandiose over-reach, comparable to wanting to “skip all the early iPhone models and jump right to the iPhone X”.

Meanwhile, though Cruise’s pedestrian collision certainly shone a spotlight on the inherent risks associated with autonomous driving technology at this point in its evolution, this and other similar mishaps have not fundamentally called the viability of the industry into serious question. As the FT’s tech writer Richard Waters wrote at the time, any such accident can “weaken trust in the technology and provoke tough regulatory intervention, but it need not set the cause of robotaxis back years – as long as Cruise and its rivals act quickly and show they have truly taken the lessons to heart.”

The latest Autotech & Mobility M&A report by Hampleton Partners states that – despite recent setbacks suffered by the likes of Apple and Cruise – “considerable momentum still exists within the self-driving sector”, with investor and acquirer interest in autotech startups indicating that “autonomous driving technology is on the road to a ChatGPT-like moment of mainstream breakthrough.”

Let’s consider some examples of major deals adding to that momentum.

One of the most significant transactions of the year came in May, when self-driving car software firm Wayve closed a $1 billion funding round – the biggest investment yet made in a European AI startup.

Microsoft is among the investors ploughing funds into UK-based Wayve, which specialises in end-to-end AI systems for autonomous driving, allowing vehicles to amass information from their environments and “empower them with the intelligence to confidently navigate situations that do not follow strict patterns or rules” – like pedestrians wandering onto the road, or another driver overtaking unexpectedly.  

The intuitive technology has been described as “GPT for driving”, and Wayve is  focusing on making it available to manufacturers of vehicles and robots, rather than rolling out its own fleet of cars. A spokesperson at SoftBank, which led the investment round, describes this as a “sensible, feet-on-the-ground strategy” – a far cry from the more gung-ho approach which Apple took with the ill-fated Project Titan.

Another major player pushing self-driving technology into the mainstream is Pony.ai, whose blunt, three-word slogan is simply “Autonomous Mobility Everywhere”. In October, the company, co-located in China and the US, secured $100 million in investment from NEOM, an urban mega-project underway in Saudi Arabia.

Under the terms of the deal, Pony.ai will develop, manufacture and deliver autonomous driving systems, vehicles and infrastructure in NEOM and other Middle East North Africa markets. Pony.ai has also been busy in other locations, expanding its robotaxi operations in Beijing and announcing its entry into the European market with the creation of an R&D centre in Luxembourg.

Luxembourg was chosen partly because of the country’s stated commitment to “the intelligent mobility sector”, and represents another major step in Pony.ai’s global expansion.

Last September, three veterans of the autonomous driving industry – Bryan Salesky, Peter Rander and Brett Browning – made a dramatic return with fledgling self-driving truck startup Stack AV.

The company hit the ground running thanks to a mammoth investment from SoftBank, speculated to be in the region of $1 billion. It’s a phoenix-like return for Salesky, Rander and Browning, whose previous company, the much-heralded autonomous driving startup Argo AI, unexpectedly shut down after its backers Ford and VW decided to shift their resources elsewhere.

Stack’s aim is to deploy autonomous trucking solutions to revolutionise the logistics industry and make supply chains smarter. SoftBank certainly has faith in Stack’s potential, with a spokesperson predicting that “Stack AV will fundamentally change the transportation of goods and supply chains across the globe.”

For more discussion of the Autotech & Mobility industry, along with the latest analysis of transaction numbers and trends, read our brand new M&A report. Find it, along with our other fresh-off-the-presses sector reports, here.