PITTSBURGH — A promising autonomous vehicle company that had raised billions of dollars has suddenly folded.
Argo AI, headquartered in Pittsburgh, had been considered an up-and-coming startup. News of its shutdown came as its main backers, Ford and Volkswagen, decided to no longer invest.
“The shutdown of Argo AI was a big shock to the Pittsburgh community, especially because they were kind of seen as a Cinderella story for autonomous vehicle companies, growing up with homegrown talent and getting on the national stage, being based here in Pittsburgh,” said Stan Caldwell, Executive Director of Traffic21, a traffic research institute with Carnegie Mellon University.
A statement from Argo AI sent to Channel 11 stated in part, “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, while employment for others will unfortunately come to an end.”
Statements from both Ford and Volkswagen stated the companies’ intention to hire Argo AI employees. Ford’s statement, however, noted that “profitable, fully autonomous vehicles at scale are a long way off.”
Caldwell has been closely watching and researching the industry for about a decade, and has lately been noticing a “general pullback of funding on a national level.”
With that said, he doesn’t expect the industry to take a downward turn.
“I believe the industry is still going to be thriving, here in Pennsylvania and nationally,” he said. “But this has just been such a volatile industry. This is a very new industry. And there are a lot of players that continue to come in and out.”
Caldwell noted that the state of Pennsylvania has been supportive of developing the industry, having invested in a facility to test the technology in Westmoreland County, as reported by our Trib partners.
Further, state lawmakers just this week passed a house bill allowing companies to test driverless vehicles on roadways.
A statement sent to Channel 11 by the Allegheny Conference reads in part, “This is a major step in making the region even more attractive to AV industry players seeking a competitive edge, including companies like Ford and VW, from whom the region would welcome investment.”
Allegheny executive Rich Fitzgerald told Channel 11 that Pittsburgh is still booming in terms of tech startups.
“I think the tech industry in Pittsburgh is going to continue to be strong. We have over 100 companies in about a 10-block area between the Strip District and Lawrenceville and I think they’re gonna continue to grow,” Fitzgerald said.
He added that the former Argo AI workers have plenty of other job options “within the great eco system that is robotics and the AI industry here in Pittsburgh.”
It isn’t clear exactly how many people are without a job.
Caldwell added, “I believe that there is enough other industry activity here in the region to absorb some of the shock from Argo AI’s departure.”
Caldwell said he expects that the industry will begin to make changes in order to “figure out business models that will become profitable.” He noted that many automakers, particularly at domestic manufacturing facilities, have already started to integrate automation tech into their vehicles.
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