San Francisco, Oct 27 (IANS) Ford and Volkswagen-backed self-driving startup Argo AI, which came into the scene in 2017 with a $1 billion investment, is reportedly shutting down.
As reported by TechCrunch, Argo AI employees were told during an all-hands meeting on Wednesday that some would receive offers from the two automakers.
"In coordination with our shareholders, the decision has been made that Argo AI will not continue on its mission as a company. Many of the employees will receive an opportunity to continue work on automated driving technology with either Ford or Volkswagen (ETR: VOWG_p ), while employment for others will unfortunately come to an end," Argo was quoted as saying.
There was no information on how many would be hired at Ford or VW or which companies would purchase Argo's technology.
After the deal with Ford and VW closed, employees were told they would receive a severance package which will include insurance and two bonuses - an annual award and a transaction bonus. This will include all Argo employees.
Those who are not retained by Ford or VW will additionally receive termination and severance pay, as well as health insurance, the report added.
Several people told TechCrunch that it was a generous package and that the company's founders spoke directly to its employees.
According to the company's third-quarter earnings report, Ford has decided to shift resources into developing advanced driver assistance systems, not autonomous vehicle technology that can be applied to 'robotaxis'.
In the third quarter, the company reported an $827 million net loss due to non-cash impairments of $2.7 billion on its investment in Argo AI, according to a report.
In addition, VW, Argo's other major backer, is planning to shift resources and no longer invest in the startup.
Using its software unit Cariad, the company says it will work with Bosch (NS: BOSH ) in the development of highly automated and autonomous driving, and with Horizon Robotics in China in the future.
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